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Keep Off the Gras^ / 1914 




HIS 

OWN 

STORY 

OF THE COMMONWEAL 

Why the March to Washington 

In 1894 

j Why the March to Washington 
! In 1914 

ILLUSTRATED 
Sold at All News Stands 

APRIL 1914 - 25 Cents 

I This Story Should Be in Every School and Library 



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CAPITAL, 
TR(£ 




ORPORATE NAMHfe|N f . 
tBOR, IS SLAVERY 




blem we will give two author 



prior to and independent of capital, 
fruit of labor, and could never have 
lad not first existed. Labor is the superior 
deserves much the higher consideration/ 
second message. 

"I affirm it as my conviction that class laws pis 
ital above labor endangers the republic more fail 
hour than did chattel slavery in the day of its h^ 
supremacy." 

"The effort to place capital above labor will 
republic, and when the attempt grows into law 
used to fasten still greater burdens upon the pe 
all liberty is lost." — Lincoln's Letter to Ellis. 

Daniel Webster said: "Sir, I say it is emploj 
makes the people happy. This great truth ought 
be forgotten. It ought to be placed upon the title j 
every book on political economy intended for Ar 
ought to head the columns of every farmer's magajj 
mechanic's magazine. It should be proclaimed eve 
'that where there is work for the hands, there is 
the tooth; where there is employment there will 
And in a country like ours, above all others, will tli 
hold good. If they can obtain fair compensation 
labor they will have good houses, good clothing, 
and the means of educating their families. Labor! 
cheerful and the people happy. The great intent <j 
great country is labor, labor, labor!"— Speech in 



THE COXEY PLAN 



Medium of Exchange Without Cost; 

Public Bonds Without Interest; 

Common Carriers Without 

Private Profit. 



A Cure for Hard Times 



Steady Employment for Every Man 
at Good Wages 



By JACOB S. COXEY 



JACOB S. COXEY, Publisher 

Massillon, Ohio 

Copyright .April, 1914 

Permission given to newspapers to extract. 







JACOB SECHLER COXEY 

MAR 31 1914 

©CI.A370399 



CONTENTS 

Government Functions page 1 

Postal Service Success 2 

Government Telegraph and Telephone 2 

Chartered Banks Unconstitutional 3 

Slavery of Interest 3 

Bank Loan Swindle 4 

The Bank Dark Lantern 4 

Burglarizing the People 5 

The Shell Game 5 

The Financial Jimmy 6 

Wall St. (Reserve Bank) Bill 6 

Why Bankers Opposed the Currency Bill 7 

Who Drew Up the Glass-Owen Bill 7 

Banks Without Interest 8 

Credit Instead of Debt 8 

Save $1,500,000,000 Yearly 9 

Bank Management Saving 9 

Financial Chloroform 10 

Corporate Dividend Slavery 10 

The Disemployed 11 

Five Conspiracies 11 

Forcing Down Price of Organized Labor 11 

The Water Stock Sale Conspiracy 12 

Financial Emancipation Proclamation 13 

Buying the Railroads 13 

Physical Value - 14 

Unemployment Waste and Loss 14 

Right to Buy Railroads 15 

Initiative and Referendum 16 

Non-Interest Bonds — Illustrated 17 

Bond Interest Cancer 18 

Dr. Coxey Prescribes to the Ways and Means Committee 19 

Commonweal Army History 45 

Coxey at the Capitol 48 

Banking and Currency Hearing 53 

Market Roads 67 

Convict Labor 74 

Government Legalizes Swindle 77 

The Socialist Missing Link 79 

T, istice for Coxey 82 

ipreme Court Decision on Legal Tender 85 

Dmmerce, Relation to Money and Transportation 84 



WHY THIS BOOK? 

Since the first Coxey march two generations have passed 
and two more have come upon the stage, all familiar in a 
vague way with the historical fact of such a movement. A 
movement which has its place in the school histories of the 
country suggests the necessity for a concise, comprehensive 
statement, making clear to the present, and more so to the 
future, the underlying impulses animating such a spec- 
tacular undertaking. To meet this need is my answer. 
WHY THE SECOND MARCH? 

April 16th, my sixtieth birthday, we start the second 
march from Massillon, arriving in Washington May 21st, 
to demand from Congress the passage of three measures 
mentioned below, and fully detailed in succeeding pages. 

It is needless to remind the reader that Coxey ignores 
beaten paths. Determining conclusions have been reached 
from hard contact for forty years with actual conditions 
as a business man. That now more than ever, we are up 
against a colossal shell game, no observing man can dispute. 

After reading the following pages, detailing my attempts 
before two congressional committees, serving one jail sen- 
tence for treading on the sacred lawns of the national cap- 
itol, if you feel a kindly impulse to co-operate toward the 
ends in view, you are asked to circulate this little volume — 
my one direct source of revenue for meeting the expenses 
of this present march. 

There are to be elected next November a House of Repre- 
sentatives, and one-third of the members of the United 
States Senate. There should be a written pledge obtained 
from all candidates for these offices before you agree to 
give them your support, that they will vote for and use all 
honorable means to enact into law the following measures : 
First — An Act of Congress to issue legal tender money and es- 
tablish a Federal Bank in every community to loan the money on 
real estate and chattel property at its assessed value at a two per 
cent tax instead of interest. 

Second — An Act of Congress to issue legal tender money and to 
permit communities to issue non-interest bonds, borrow money on 
them from the United States Treasury, hire the unemployed in road 
building and other public work; for purchase and supplying other 
public needs, and to repay such loans without interest in twenty-five 
annual installments. 

Third — An Act of Congress to issue legal tender money to buy 
the railroads, pipe lines, telegraphs and telephones at their physical 
values, and operate them at cost. 

Or, failing in this peaceful and desirable mode, then 
revolution. Think it over ; is there anything else left for 
us to do? JACOB S. COXEY. 

Massillon, Ohio, March 25th, 1914. 

/ 



THE COXEY PLAN 

MEDIUM OF EXCHANGE WITHOUT 
COST; PUBLIC BONDS WITHOUT 
INTEREST; COMMON CAR- 
RIERS WITHOUT PRI- 
VATE PROFIT. 

The first things that confront a government when 
constructing law are land, labor, production and distribu- 
tion. The laws must be enacted to control and regulate, 
or own and operate, these things. 

Justinian, who is conceded to have been the greatest 
law-giver of the Roman period, reduced Law into three 
precepts : First, to live honestly ; second, to hurt nobody ; 
and third, to render unto each his due. 

These three precepts are the foundation of the Com- 
monweal and should be expressed in the laws, so as to 
bring about a government of the people, by the people and 
for the people. 

We have practically solved the question of production, 
but we have not brought about a system of equitable dis- 
tribution. We, today, are working under a system of in- 
equitable distribution. 

In order to find out what is necessary under a system 
of equitable distribution, one must analyze the functions 
that are being used in distributing. 

THREE FUNCTIONS OF GOVERNMENT 

There are three functions, and I contend that they 
are solfely governmental: First, the means of communi- 
cation; second, the means of exchange; third, the means 
of transportation. 

Get these three functions fixed clearly in mind and 
everything else is easy to reason out. If you do not start 
with the correct premises, you never can reason out a cor- 
rect conclusion. 

Are these three functions the means of communica- 
tion (postal, telegraph and telephone service), the means 
of exchange (money) , and the means of transportation 
(market roads, railroads and steamship lines) — govern- 
ment functions? 

If they are, they should be owned, used, operated and 
furnished at cost to all the people. 



THE COXEY PLAN 



What do we use in communicating with each other? 
The postal system, telegraph and the telephone. We must 
communicate with each other before we can transact any 
business. 

After we have done that, then what do we arrange 
for next? Means of exchange, the means to produce and 
to exchange the products from the producer to the con- 
sumer. What do we use in that? Money. 

Then after we have arranged for the production and 
exchange of the products, next comes the means of trans- 
portation. That means the market roads, railroads and 
steamship lines. 

POSTAL SERVICE SHOWS EFFICIENCY AND EQUITY 

What have we done with those different governmental 
functions? The first one, the means of communication, is 
in part the postal service. We have retained and are op- 
erating that at cost to all the people. Let me illustrate: 
For example, if John D. Rockefeller, who is reputed to be 
the wealthiest man in this country, with all his corpor- 
ations, needs 10,000 postage stamps tomorrow, he must 
pay the same for each of those postage stamps as the man 
down on the street digging in the ditch, who buys only 
one; that man is on an equality with John D. Rockefeller 
under that law. 

The same equality of conditions should apply to the 
telegraph and telephone lines, the means of exchange, 
(money) , and the means of transportation, (market roads, 
railroads and steamship lines). 

GOVERNMENT TELEGRAPH AND TELEPHONE 

The telegraph and telephone systems have been in- 
vented since the formation of this government. These 
should be owned and operated at cost to the people, but 
the government has left these go along with the means 
of exchange and of transportation. Instead of purchasing 
these inventions from the inventors and remunerating 
them for their efforts, they have granted franchises to 
corporations, which have erected these lines, and have put 
one dollar into physical value and two dollars in water 
value in the shape of stocks and bonds upon those insti- 
tutions, and today are levying tolls on the water value as 
well as on the physical value. 

I predict that during Wilson's administration, the 
Government will take over the telephone and telegraph 
systems of this country. But they are not going to take 






THE COXEY PLAN 



them over by the proper method, which is to issue legal 
tender money with which to pay for them at their physi- 
cal value. They are laying their plans to substitute 4% 
interest bearing Government bonds for the entire watered 
dividend-paying stocks and bonds. 

Now let us get up into the means of exchange — 
money. What is money? Money is an idea of Congress 
enacted into law. It is a National medium of exchange 
used in exchanging labor in production, and to exchange 
the products of labor from the producer to the consumer. 
It simply represents values which are created by labor or 
services rendered and is a legal order for goods, and never 
should have, or be of, any value in, or of, itself. This is 
all that money is or should be. It should not get into 
circulation without a service being rendered or a value 

BANKS BASED ON ILLEGAL FRANCHISES 

What have we done with this function? We have 
granted franchises to banking corporations for the last 
50 years in violation of the Constitution of the United 
States. You cannot find in the Constitution any right on 
the part of the Government to grant franchises to any cor- 
poration. The debate before the Constitutional Conven- 
tion of 1787 on the question of the right of the Govern- 
ment to grant charters resulted in its being voted down. 
Therefore, it is a violation of the Constitution to grant 
charters. 

After granting these franchises, then the Govern- 
ment creates money and turns it over at cost to these cor- 
porations, but when even the Government itself (which 
has created it) wants to use the money, how does it ob- 
tain rt? It issues interest-bearing, non-taxable bonds, sells 
them' to these corporations and borrows its own money, 
and our Government taxes our people to pay interest to 
these corporations for the use of the people's own money. 

The new banking law does not change the system. 
The Democratic administration had agreed with the bank- 
ing fraternity to give them a bill to their liking, and they 
claim now that the new bill is better for the bankers — 
than the old bill which had been in force for 50 years. 

STUPENDOUS BURDEN OF INTEREST 

Let us see the burden placed on the people through 
this currency system. 

President Taft in 1912 called the governors of the 
states together and told them that there are 12,000,000 



THE COXEY PLAN 



American farmers who are producing annually $9,000,- 
000,000 of products on a borrowed capital of $6,040,000,- 
000, on which they are paying in interest and commissions 
an average of 8^% per annum. 

This amounts to a total of $513,000,000 annually, 
which the tillers of the soil are compelled to pay to the 
banking institutions to which the Government has turned 
the money over at cost. 

Besides, this law authorizes the banks to loan 88% of 
their deposits (their debts), so that they can receive in- 
terest for the use of that money and legalized credit — 
their debts. This is a burden that is placed on the tillers 
of the soil, simply for their privilege of doing business 
and producing that which we are consuming. 

EVERY REAL DOLLAR LOANED TO TEN PEOPLE 

We have $17,000,000,000 of bank deposits, $13,500,- 
000,000 of loans out of those deposits, and $1,500,000,000 
of legal tender money reserves in these banks — which re- 
serve is the only real money we have and is the founda- 
tion for the $13,500,000,000 of loans. There are nine dol- 
lars of loans to every dollar in the bank; and the banker 
is receiving from six to eight and one-half per cent in- 
terest for the use of his credits or debts to this amount. 
In other words, the banker is loaning out his debt and 
receiving interest on his debt, and the producers pay this 
interest on these banks' debts. 

An average of 8% would be over $1,000,000,000 an- 
nually. That is what the manufacturers of this country 
pay to produce and exchange their products. THE PRO- 
DUCERS MUST PAY FOR THE USE OF THE BANK- 
ERS' CREDIT, which is charged up to the consumer when 
he purchases the products. Add that to the $513,000,000 
paid by the tillers of the soil and it makes nearly $1,600,- 
000,000 in interest annually, which is the banking tax put 
upon the producers of this country in producing our prod- 
ucts and exchanging them. 

THE BANK SYSTEM AS IT WORKS 

I propose to show how to substitute cash in place of 
these fictitious bank credits. I want to illustrate to you 
the system of our national banks: 

Take, for instance, one of the banks in my home 
town which has deposits to the extent of $800,000. Under 
the law, this bank is compelled to keep as a reserve fund 
in its vaults 6% of its deposits in cash, and 9% it may 



THE COXE Y PLAN 



deposit in reserve banks. That makes 15 per cent legal 
tender money as reserves, but 85 per cent of the deposits, 
which are the bank's debts legally, it is allowed to loan 
out. 

I show you this $800,000 deposit to prove how little 
real legal tender money the bank has. Fifteen per cent of 
$800,000 is $120,000. The bank, therefore, loans out 
$680,000. It must retain in the bank in lawful money six 
per cent in cash, which is $48,000, and nine per cent, or 
$72,000, is deposited in reserve banks upon which it re- 
ceives two per cent interest on daily balances. 

DRAWING INTEREST FROM THE PEOPLE ON THE 
PEOPLE'S OWN MONEY 

You see the bank is receiving interest upon $680,000 
of its deposits. What is it doing business on? Not a 
dollar of its own money, because its money has gone into 
national bonds purchased from the Government. Those 
$100,000.00 of bonds were deposited with the Government, 
and the Government issued 95% of the face value of the 
bonds in national bank notes (the balance of 5% being 
held in a redemption fund) with which to start and do 
business. 

Therefore, its money is deposited in Government 
bonds upon which it is receiving 2% interest and paying 
no taxes, which is equal to another 1%, and which makes 
it equal to a 3% bond. The bank was started with $95,- 
000.00 in national bank notes. It has deposits up to 
$800,000.00. It loans out the $95,000.00 of bank notes, 
besides $620,000.00 of the deposits; and all it has in real 
cash in the bank with which to pay the deposits of $800,- 
000.Q0 is six per cent, or $48,000.00. 

REDEMPTION OF THE BANK NOTES 

I want to show you a little more of the redemption 
of these national bank notes. There is being returned 
from the banking institutions of this country an average 
of $2,000,000.00 a day by express to the Treasurer of the 
United States in national bank notes for redemption pur- 
poses. When they are sent in, the U. S. Treasurer ships 
in return by express, lawful money (greenbacks or gold; 
very seldom does he ship gold) ; then the Treasurer noti- 
fies the various banks how much of their currency has 
been sent in for redemption, whereupon those banks must 
ship by express lawful money to the Treasurer to redeem 
their notes. Then the Government prints new bank notes 



THE COXEY PLAN 



and sends them to the banks in place of legal tender that 
they have shipped to the Treasurer for redemption pur- 
poses. 

EXPANSION AND CONTRACTION OF CREDITS 

For example, suppose a national bank has in circula- 
tion $95,000.00 in national bank notes. A number of 
banks receiving these notes as deposits are unable to use 
them as legal reserves and they forward $10,000 to the 
U. S. Treasurer at Washington for redemption in lawful 
money. The Treasurer at once expresses to the bank send- 
ing the currency, $10,000 lawful money (greenbacks or 
gold) in return, which can be used as legal reserves and 
is a basis of $90,000 of credit or loans on which they can 
draw interest. Then the Treasurer notifies the bank which 
this currency was issued against to express $10,000 in 
lawful money to redeem these notes. Upon receipt of 
same, the Treasurer reissues $10,000 of national bank 
notes and expresses them to the bank. This system causes 
four express charges and causes continuous expansion and 
contraction of bank and commercial credits. 

Under the new banking law there is no change in 
respect to this. There is a lowering of the reserve. The 
new law requires country banks to hold only 12% reserve 
instead of 15%, and 4%. in cash instead of 6%, and 8% 
in district reserve banks as reserves instead of 9%, which 
they can borrow and now make 6% on instead of 2%, as 
they did before, on daily balances. Instead of a bank in 
a city holding 25% reserve, as it did, it is now compelled 
to hold only 18%, so it gets out 7%' more of the banker's 
credit, or wind. 

THE WAY THE RESERVE BANKS WORK IT 

The new banking law ,puts 12 reserve banks in differ- 
ent parts of the country, each one to have its own district 
or territory. These reserve banks are to be owned and con- 
trolled by member banks and they are so arranged that 
all the banking institutions in the country may have op- 
portunity of joining this system and using these reserve 
banks in their districts to hold their reserves, with the 
theory that it is going to be closer to them, so that in an 
emergency they can re-discount paper and obtain currency 
more quickly by borrowing their own capital and re- 
serves. But now if money gets tight, the member banks 
can send their paper to the reserve bank in their district 
and have it rediscounted. If any other emergency arises, 



THE COXEY PLAN 



then this reserve bank can send in to the reserve board 
at Washington and have currency issued against these 
notes, but 40% in gold must be furnished as a reserve. 
These notes shall not have a longer period to run than 
180 days and are not to be money. So don't you see what 
a poor business this will be? None of those notes on 
farm mortgages are to be money, they are simply to be 
the same kind of currency that we are using in the shape 
of bank notes. 

Few people realize that national bank notes and gold 
and silver certificates, while receivable for debts, are not 
legal tender, and can be refused when tendered in pay- 
ment of a judgment. Then they must be exchanged for 
either greenbacks or gold, as gold and silver certificates 
are simply warehouse receipts. 

The member banks can borrow from the reserve 
banks their own reserves, surplus, capital, postal deposits 
and all Government revenues. 

Is it any wonder that it is contended in behalf of the 
new law that it is better for the banks than the old one? 
President Wilson selected Professor Henry Parker Willis, 
editor of the Journal of Commerce, New York, a Wall 
Street organ, to draw it, administration pretending it 
was the Glass Owens measure. Wall Street bankers were 
pretending to be against the bill, knowing that if they 
advocated it the people would have defeated it. The 
bankers even held a convention at Boston and denounced it. 

HOW IT WAS "PUT OVER" ON THE PEOPLE 

So after 50 years of denunciation of the National 
Banking system (ever since its enactment) , by the leaders 
of that once great party of Jefferson and Jackson, they 
have at the very first opportunity, and within 10 months 
after obtaining complete control, and with hardly a mur- 
mur of objection from the floor of the House or Senate, 
enacted a Currency bill that causes the old National Bank- 
ing System to pale into insignificance compared to this 
new one. By doing so they have completely surrendered 
to the 25,000 banks and placed 99^ of the people in serf- 
dom through interest worse than that of the black men 
and women prior to the Civil War. 

At present the people seem to be asleep, but they 
will finally wake up out of that slumber of deceit, pre- 
tense and sham and find that their idol, William Jennings 
Bryan, has sold not only his but their birthright for a 



8 THE COXEY PLAN 

mess of potage (Power and the Almighty dollar), and 
has minted his cross of gold for a basis for the New 
Banking System and is now feeding the people the thorns 
from his crown. 

A BANKING SYSTEM FOR THE BENEFIT OF 
THE PEOPLE 

As I said, we have come to a constructive period. 
We have been tearing down; now we must commence to 
build up a structure better than the one we tear down. 

I appeared on the 23rd of October, 1913, before the 
Banking and Currency Committee of the Senate at Wash- 
ington, and I argued from my standpoint and proposed 
my plan. 

My plan is this: 

The Government establish a bank in every municipal- 
ity of over 1,000 population. 

That in towns of under 1,000 population and over 500, 
the banking be done through the post offices. 

That all the money issued by the Government shall 
be made a full legal tender for all debts. 

That the money shall be engraved and printed in suf- 
ficient volume for the demands of trade, just the same as 
the postage stamps are engraved and printed. 

That this money be sent to all these Government 
banks and post offices. 

That the money be loaned out on the same collateral 
as that upon which the banks are now loaning and upon 
all real and chattel property at its face and taxable value 
at. a tax of 2%. 

This will solve the question of the means of exchange 
— money. 

MONEY INSTEAD OF INTEREST-BEARING CREDITS 

Then substitute gradually, to take the place of $18,- 
000,000,000 of bank credits and less than $2,000,000,000 
of currency (not money), full legal tender money, at a 
tax of 2%, thus eliminating interest. Simply because the 
people have had interest thrust upon them for centuries 
is no reason why it should be continued. 

This tax of 2% is not interest. I call it a tax; and I 
can prove it is a tax. It will cost one-half of one per cent 
to pay all operating expenses for all these banking insti- 
tutions on total amount loaned. Deduct that from 2% and 
there is left a national revenue to the Government of one 
and one-half per cent. 

This will be in lieu of other taxes. Those who will be 



THE COXEY PLAN 



using the money will be paying a tax of at least one and 
one-half per cent on all money furnished, to pay the run- 
ning expenses of our Government. Then we could abolish 
import, duties and let all goods come in free. 

This, together with the Non-Interest Bond Bill, is the 
proposition I put before the Banking and Currency Com- 
mittee of the U. S. Senate. 

A SAVING OF $1,500,000,000 A YEAR 

Let us see the saving it would make. Sixteen hundred 
millions of interest is being taxed out of the producers and 
consumers today for the use of the nine dollars of legal- 
ized bankers' credit and one dollar of real money. Reduce 
that down to 2%, instead of 8%, and it will be $1,200,- 
000,000 saved to the people annually. In addition to that, 
all real money being furnished to the people at a tax of 
one and one-half per cent furnishes a revenue of $300,- 
000,000 annually, which will go into the coffers of the 
Government to help pay its running expenses. 

To illustrate the economic saving : In Massillon, Ohio, 
we have five banks, which means an expense of five bank 
presidents, five cashiers, five sets of clerks, five sets of 
books and five bank buildings. They loan out an average 
of $4,000,000 annually, 88% of which is bankers' credit, 
or deposits at an average rate of 7%, which means 
$280,000. 

SAVING IN COST OF BANK MANAGEMENT 

Under my plan we would have only one bank presi- 
dent, one cashier, one set of clerks, one set of books and 
one Bank building, loaning out $4,000,000, at a tax of 2%, 
which means a Government revenue of $80,000 annually, 
— $200,000 in interest charges — saved to the producers 
and consumers of Massillon annually. Allowing $20,000 
(which is one-half of one per cent, on money loaned* to 
pay one bank president, one cashier, one set of clerks, 
keeping one set of books and maintaining one government 
owned bank building, leaves a clear revenue to the Gov- 
ernment of $60,000 annually. 

Thirdly is the means of transportation. In addition 
to that there is another proposition that is confronting the 
American people. It is one of the greatest we have. That 
is the system of public improvements, such as roads and 
streets ancj all internal improvements, also all public util- 



10 THE COXEY PLAN 

ities, because we are at the point now where we must 
rapidly take over public utilities and operate them at cost 
to the people. 

PUBLICITY AGENTS AT WORK ON THE PUBLIC 

How can this be done? Very simple. But they are 
laying their plans and have their publicity agents at wofk 
to create the impression that if the Inter-State Com- 
merce Commission does not increase the freight rate five 
per cent, there will be government ownership. They are 
trying to make the people believe that the stocks and 
bonds put upon the public utilities of this country are 
genuine, notwithstanding that two-thirds is water. 

In Poor's Railroad Manual we find that we have 
$10,000,000,000 and some odd millions of railroad bonds, 
bearing 5% interest, and $8,800,000,000 of railroad stocks, 
paying 6 to 10 per cent, dividends. But when we go into 
the matter a little further, we find that an average of 60% 
on the dollar was all the real money that was acquired 
by the railroads for these bonds. Therefore the physical 
value of the railroads in bonds amounts to only six bil- 
lions with four billions of water. 

There are over $18,800,000,000 of railroad bonds and 
stocks, two-thirds of which is water; and our Government 
legalizes this water by going into partnership with the 
railroads of the country. It is running them ; it is levying 
the tolls through the Inter-State Commerce Commission 
on the freight being transported by these railroads ; fixing 
the rate of wages for the men that are operating these 
roads. 

THE ENORMOUS BURDEN OF INTEREST DIVIDENDS 

There is over $1,080,000,000 annually that must come 
out of the consumers to pay tolls — to pay the interest on 
these bonds and dividends on these stocks. There is the 
burden through the means of transportation, and the Gov- 
ernment is the managing partner in it, but does not receive 
any of the profits. 

I will later show you how we can change that. I 
want to show you a great conspiracy now between those 
controlling the means of exchange — money — and the means 
of transportation (the railroads and steamship lines). 
The men handling all the reserves of the banking institu- 
tions of this country are in New York, Chicago and St. 
Louis. They are controlling the means of exchange — 
money. Those same men are directors in the principal 



THECOXEYPLAN 11 

railroads. Through this they are controlling the means of 
transportation. 

WHY FIVE MILLION MEN ARE IDLE 

Here is what they have brought upon the country: 
You will find men every hour in the day asking each other 
why are the works closing down, throwing people out of 
employment. Why are the railroads curtailing, throwing 
even the section hands off? I will tell you why. Last 
year the money men of New York had got the railroads 
and industrial stocks up to the highest point. They un- 
loaded at the highest prices. 

Here is the way the game is played. During the 
year of 1912 they purchased 235,000 cars. That was an 
average monthly purchase of nearly 20,000 cars. In Janu- 
ary of 1913 they purchased 30,000 cars. This was an 
increase of 50% over the normal monthly purchases dur- 
ing the year 1912. That was to create the impression that 
we were having a great boom. It raised the price of 
stocks, both industrial and railroad. Then in February 
they purchased 22,000 cars, in March they purchased 
5,000 cars; in April, 10,000 cars. Now they were ready 
to break the market because they had unloaded their 
stocks at the high prices.* They purchased in May, 2,500 
cars; in June 1,000 cars, and every month since June the 
balance of the year 1913, they purchased an average of 
2,000 cars. There was a stopping of purchase of equip- 
ment for all railroads of 90%. 

The car works in this country that were receiving 
orders during 1912 of 20,000 cars per month, were receiv- 
ing for the last eight months of 1913, orders to the extent 
of only 2,000 cars a month. Those plants had to throw 
their people out of employment. 

A CONSPIRACY TO ACCOMPLISH FIVE THINGS 

The men who are controlling the means of exchange 
and transportation and the output of steel rails had en- 
tered into a conspiracy to accomplish five things. 

The first one was to force Congress to shape a cur- 
rency bill to their liking. That has been accomplished. 

The second was to force the Inter-State Commerce 

*The Wall St. Journal shows 29,109 more stockholders in indus- 
trial and railroads in 1913 than in 1912. 



12 THE COXEY PLAN 



Commission to grant a 5% freight increase to the rail- 
roads. 

The third was to force down the price of equipment 
for the railroads. By shutting off orders 90%, the manu- 
facturers were forced, in order to hold their men and 
maintain their organizations, to go out in the market to 
the railroad purchasing agents and offer their material 
from 25 to 30 percent, less. 

The fourth was to force the price of labor down by 
closing the works and bringing workingmen into competi-, 
tion with each other. 

The fifth was to make a clean-up on their stock. 
This winter, 1913-14, they are buying them, on the low 
level, and when they have done that, they are ready to 
give their orders for equipments. The plants will start 
up. Men will go to work and we will go on a grand boom 
again for the next four or five years. That is the way 
they manipulate prices of property and labor. 

TRYING TO TURN ANOTHER TRICK ON THE 

PUBLIC 

They will try to educate the people to take the public 
utilities over, because they have a burden on their hands. 
It is impossible for them longer to finance the railroads, 
since the laws compel them to keep them in the condition 
necessary for the safety of the public and the transporta- 
tion of commerce. Eight billions, eight hundred millions 
of the water stock is not legitimate ; four billions of water 
bonds are not legitimate. And they are trying to shape 
it up so the government in taking it over will substitute 
government bonds bearing 3 to 4%< interest in place of 
present bonds and stocks. 

I contend that we are approaching the greatest crisis 
in this country, — the greatest that ever confronted us. It 
is worse than the crisis of 1860, when the people in the 
South held the black men 'and women in slavery. They 
were legal property under the law. The people in the 
North contended that slavery was wrong; that it must be 
abolished; and I say today we must eliminate usury or 
interest and dividends which has enslaved both blacks and 
whites. 

How did we eliminate slavery? Did Congress pass a 
law to appraise and condemn the slaves, and issue legal 
tender money and pay the slaveholders for their slaves ? 
Oh, no. They went into a bloody conflict and the people 
of the North went South and forced the slaveholders to 



THECOXEYPLAN 13 

give up their slaves. Our government issued legal tender 
money and paid the brothers of the North to shoot their 
brothers in the South. Was that sensible? 

A SOLUTION EQUITABLE AND EFFECTIVE 

I do not propose to abolish interest and dividend 
slavery in that manner. We want a peaceable, just and 
equitable solution. We have the law, and we can appeal 
to the intelligence of the people. How can it be done? 
Simply by the adoption of two bills. 

In 1894 we had a depression similar to what has come 
on now. Then what did we do? The Commonweal organ- 
ized and marched through to Washington and appealed 
to Congress to pass a bill into law. 

By that one measure and with the Government banks 
furnishing money at 2% to all the people, we can emanci- 
pate the w T hite as well as the black people. That bill 
provides that when a state desires to make a public im- 
provement or wants to take over a public utility or indus- 
trial plant, is to be allowed to issue and deposit its non- 
interest bonds with the Federal government, which is to 
issue the face value of those bonds in full legal tender 
money af cost. That cost will not exceed over one per 
cent. The 99% would be forwarded to the state that de- 
posited its bond in accordance with the bill. Then the 
state would have the money to build public improvements 
and utilities or take them over and pay for them. 

THE RIGHT WAY TO BUY THE RAILROADS 

Let us work it out. Take for instance the state of 
Ohio. In order to make an illustration, let us say that the 
railroads of the state may be estimated at about $99,000,- 
000 in value. The state of Ohio would issue $100,000,000 
in non-interest bonds to run for 25 years. These bonds 
would not be sold, but deposited with the government at 
Washington as collateral security. Then the government 
would issue $100,000,000 and the $99,000,000 would be 
forwarded to the state treasurer of Ohio. A commission 
would be appointed to appraise the railroads of the State. 
Then with this legal tender money the State would get 
the deeds for the railroads, and the State would run them 
itself. 

Anything "unbusinesslike" about this? 

Any "confiscation" in it? 

Out of the revenues of the roads the State would 
return to the Federal Government 4 % annually of amount 



14 THECOXEYPLAN 

borrowed. In 25 years it will have returned the $100,- 
000,000 to the government. 

We, the people of Ohio, would simply legalize arid 
utilize our own credit. 

PHYSICAL VALUE IS ALL THE RAILROADS OWN 

They say we cannot take these railroads, because they 
are private property, franchises having been granted to 
them. I contend that it is not a Federal proposition but 
a State proposition; that the railroads have been built 
through franchises granted by States and not by the Fed- 
eral government. We can condemn them for the public 
good. 

I contend that we should pay for them at their phys- 
ical value alone if we take them over at all. 

If we eliminate interest and dividends, then that 
much is taken off the price of the products of the country. 
I have shown that the farmers are paying $513,000,000 
in interest and commissions for the money they are using, 
and the other producers are paying over $1,000,000,000 
for the use of nine dollars of the bankers' credit to one 
of real money. If we can cut that down to $400,000,000 
there would be $1,200,000,000 annually, which now must 
go on the price of the products, because the consumer 
is the one that is paying all this burden in the end. 

Take the tax of $1,080,000,000 annually in freight 
rates upon the goods that are shipped over the railroads, 
and add this to the $1,200,000,000 of interest charges, 
and it would make over $2,200,000,000 annually saved to 
the American people. Therefore we would lessen the 
hours of toil, raise the rate of wages and lower the price 
of all products, besides paying for the cost of the means 
of transportation at the annual rate of 4% out of the 
revenues on the freight rates. 

TREMENDOUS WASTE THROUGH 
UNEMPLOYMENT 

Few people realize the waste to the nation by the 
loss of 5,000,000 unemployed men daily. Even .at an aver- 
age in purchasing power alone of $1.50 per day each, it 
means $7,500,000 each day, $195,000,000 each month, 
$2,340,000,000 each year, loss in wages. If this lost labor 
were employed in building roads at $15,000 per mile it 
would build 156,000 miles of 18 ft. brick roads a year 
which would in less than seven months complete the road 
system of Ohio. 



THE COXEY PLAN 15 

The annual waste in purchasing power alone, not 
counting the value the men would create if employed, 
amounts to more than double the total annual expenses 
of our Government. 

It is high time that all citizens should become aroused 
to a realization of these conditions, and help make the 
true conditions known, so that we can bring about a 
change and a return of prosperity and make it permanent. 

This can be done immediately by the adoption first of 
the Non-Interest-Bond bill, which will allow r the States, 
Counties, Townships, Municipalities, Towns and Villages 
to finance all public improvements, without interest, so as 
to give relief to every, section of the country at once by 
setting all of the idle unemployed at work in beautifying 
and improving the country at remunerative wages, until 
there is a demand for their labor in production. 

Second, a law establishing a Federal bank in every 
city to loan legal tender money on real estate and chattel 
property at its face value, at 2% tax, and abolish interest. 

THE RIGHT TO TAKE OVER THE RAILROADS 

Many Socialists and others take the extreme position 
that the Banking, Public Utilities and Telegraph, Tele- 
phones, Railroads and large manufacturing trusts are 
legalized pirates, having stolen from and levied tribute 
upon the American Producer and Consumer tens of bil- 
lions of dollars, and that their entire holdings should be 
confiscated either by law or force if necessary. 

Those in possession of these institutions contend that 
they have been acquired through law, and are legal prop- 
erty. They appeal to the courts and are there upheld 
notwithstanding the fact that their franchises have been 
often obtained through bribery and corruption and against 
public policy. 

Here is the equitable solution: 

FIRST: The franchises have been gifts that right- 
fully belong to all the people, with no physical value in 
them; therefore these should be confiscated and restored 
to the rightful owner, the people. 

SECOND : The physical value in actual dollars put 
into these properties, or appraised at what they could be 
reproduced for, represented by interest-bearing bonds and 
dividend paying stocks, should be paid to the holders 
thereof in full legal tender money issued by the govern- 
ment for that express purpose. 



16 THECOXEYPLAN 

Initiative and Referendum 

How to Build All Public Improvements, Purchase All 

Public Utilities and Provide for All Public Needs 

by the Non-Interest Bond Plan 

In illustrating the City of Massillon's Non-Interest 

Bond, you can easily understand that that which applies 

to Massillon would apply to all states, cities, towns and 

villages; then make the same application to Townships in 

building Roads, Bridges, School Houses and Ditches by 

the Township Trustees issuing Non-Interest Bonds on the 

Township. The County Commissioners on the Counties 

to build Court Houses, County Buildings and Bridges. The 

State Legislature authorizing the issue of Non-Interest 

Bonds on the State to buy, own and operate the Railroads, 

Pipe Lines, Telegraphs, Telephones and Ship Canals and 

build Market Roads. , T .,, ~ -. .,, inA1 

Massillon, 0., May 4th, 1901. 

The undersigned, constituting more than one-tenth 
[1-10] of the voters of the City of Massillon, Ohio, do 
petition the Council of the City to formulate the proper 
ordinance [according to the initiative and referendum] 
and to take the necessary steps to procure from the gen- 
eral Government the sum of One Hundred Thousand dollars 
[$100,000] to be expended according to law in the making 
of public improvements in the City, including the paving 
and sewering of the streets, the building and maintaining 
of schools and school houses, public library, public hall, 
market house and public park, the purchase, maintenance 
and operation of water works, street car lines and gas 
and electric light plants to furnish water, light, heat and 

P° wer - Signatures of Petitioners. 

Council Chamber, 
City of Massillon, May, 5, 1901. \ 
A petition [the above petition] of more than 10 per 
cent, of the voters of the City having been presented to 
the Council, and it being mandatory upon the Council to 
comply with the request of the voters as indicated in the 
petition, it is now by the Council resolved that the ques- 
tion of adopting or rejecting the following ordinance be 
submitted to all the voters of the City at a special election 
to be held oil June 6, 1901, as to whether the City should 
proceed to procure from the general Government the sum 
of money mentioned in the said petition, to-wit: One 
Hundred Thousand Dollars, to be expended for the pur- 
poses therein named. And it is ordered that prior to 



THECOXEYPLAN 17 

such election notice of the intention to hold the same shall 
be published for at least thirty days in the newspapers of 
the City. 

Clerk Pres. 

The ordinance is in these words : 
Be it Ordained by the Council of the City of Mas- 

sillon, 0., as Follows: 

Section One. That said City of Massillon procure 
from the general Government the sum of One Hundred 
Thousand dollars. [Less the one per cent, to be deducted 
by the Government for engraving, printing and bookkeep- 
ing.] 

Section Two. That the City, by its proper officials, 
execute and deliver to the general Government its bond, 
or obligation, for the like sum of One Hundred Thousand 
dollars, to run for the period of Twenty-five years, stipu- 
lating for the return by the City to the Government of 
the amount thereof in Twenty-five annual installments of 
four per cent, each, without interest. 

In voting, those who favor the Ordinance shall vote 
"Non-Interest Bond Ordinance Yes," and those who op 
pose "Non-Interest Bond Ordinance No." 

Such election being presumed to have been held, if a 
majority vote "Ordinance No" that, of course, ends the 
matter, but if a majority vote "Ordinance Yes," it would 
become mandatory upon the Council to pass another reso- 
lution directing the proper officials to prepare the Bond 
and send it to Washington. 

There should also be a National I. & R., but should 
only require ten states to furnish ten thousand signatures 
each for any national amendment or law they wish to 
propose and submit. 

STATE OF OHIO, U. S. OF A. 

CITY OF MASSILLON, O. 

NON-INTEREST BOND 

(BASED ON LAND VALUES EXCLUSIVE OF ALL 

IMPROVEMENTS.) 

The City of Massillon, Ohio, hereby acknowledges it- 
self indebted to the United States of America in the sum 
of ONE HUNDRED THOUSAND DOLLARS, well and 
truly to return to the United States ichich said sum of 
money, in twenty-five annual installments of FOUR per- 
cent, each, but without interest. The Council hereby binds 
and charges the real estate of said City, not including 
buildings and improvements thereon, with the minimum 
tax or levy thereon of FOUR Mills on each Dollar, or 



18 THECOXEYPLAN 

FOUR Dollars for each THOUSAND Dollars, each and 
every year until the full amount of Bond shall have been 
raised and returned. 

One of the attached coupon receipts, -representing 
FOUR percent, of the principal sum hereinbefore named, 
is to be surrendered by the Government to the Council 
on return of the amount of each installment, and the Bond 
itself on the return of the last installment, on July 4th, 
1926. 

Dated, Massillon, Ohio., July Uth, 1901. 

seal Clerk Mayor. 

Coupon Accompanying City of Massillon Bond 
Washington, D. C, July 4th, 1925. 
This Coupon No. 24, attached to Bond 1, Series 
A, of the City of Massillon, Ohio, deposited with the 
Treasurer of the United States, is a credit on said 
Bond for the sum of $4,000, this day returned to 
said Treasurer and is a receipt therefor to said City. 

Massillon City ( Signed) 

Treasurer's Voucher. Sec'y of Treasury of U. S. 

TWO PARALLELS 

COXEY NON-INTEREST BOND PLAN 

Against 

THE PRESENT TAX-EATING INTEREST SYSTEM 

Two Parallels to Consider. — Two Methods of .Building a 

Court House or any other Public Improvement 

Open to the People Who Have Only to 

Make Choice 

INTEREST-BEARING BOND NON-INTEREST BOND 

COURT HOUSE. COURT HOUSE. 

Bonds voted to run twenty Amount retained by gov- 

years $200,000 ernment for printing 

Interest at 5 per cent, for notes $2,000 

twenty years to be paid 



to the bondholders. $200,000 T j $200,000 

Total principal and interest * ' 
$400,000 Amount of tax necessary to 

Under this system the peo- ra ise each year to pay on 
pie will have paid $200,- principal, at 4 per cent., 
000 in interest at the end $8,000, or aggregate in 
of twenty years and still twenty-five years.. . .$200,000 
owe $200,000 as the prin- 
cipal. In twenty-five years the 

Non-Interest Bond depos- $200,000 bond is paid, 

ited with the government and cancelled without a 

$200,000 cent of interest, the court 

Treasury notes issued by house built and paid for 

the government $198,000 at a total cost of $200,000. 

This will furnish a National Currency, Full Legal 
Tender, to substitute a cash system in place of the credit 
system that has failed us, and saves the interest. 



T II E C O X E Y P L A N 19 

The Cause and the Cure! 

Statement 
By Mr. Jacob S. Coxey, of Massillon, Ohio on 
THE CURRENCY QUESTION 
Before the Sub-Committee of Ways and Means Committee 
of Congress, Washington, D. C, Tuesday, Jan. 8. 1895. 
[Official Report of Mr. Coxey's verbal statement, taken for the 
Government by the stenographer of the Committee on Ways 
and Means.] 
SUB-COMMITTEE 
Wm. J. Bryan, Benton McMilun, Justin R. Whiting, 

Julius C. Burrows, John Dalzell. 

COMMITTEE ON WAYS AND MEANS, 
Washington, D. C, Tuesday, Jan. 8, 1895. 
The. subcommittee of the committee on Ways and 
Means, having under consideration the subject of bond 
issues, this day met, Hon. William J. Bryan in the chair. 
Mr. J. S. Coxey, a resident of Massillon, Ohio, ap- 
peared before the committee in advocacy of the following 
bills: 
53d Congress, 2d Session, H. R. 7463, June 15th, 1894 

A BILL to provide for public improvements and em- 
ployment of the citizens of the United States. 

Be it enacted by the Senate and House of Representa- 
tives of the United States of America in Congress assem- 
bled, That whenever any State, Territory, County, Town- 
ship, Municipality, or incorporated town or village deems 
it necessary to make any public improvements it shall 
deposit with the Secretary of the Treasury of the United 
States a non-interest-bearing twenty-five year bond, not 
to exceed one-half of the assessed valuation of the prop- 
erty in said State, Territory, County, Township, Munici- 
pality, or incorporated town or village, and said bond to 
be retired at the rate of four per centum per annum. 

Sec. 2. That whenever the foregoing section of this 
act has been complied with it shall be mandatory upon 
the Secretary of the Treasury of the United States to have 
engraved and printed Treasury notes in the denominations 
of one, two, five and ten dollars each, which shall be a full 
legal tender for all debts, public and private, to the face 
value of said bond and deliver to said State, Territory, 
County, Township, Municipality, or incorporated town or 
village ninety-nine per centum of said notes, and retain 
one per centum for expense of engraving and printing 
same. 



20 THECOXEYPLAN 

Sec. 3. That after the passage of this act it shall 
be compulsory upon every incorporated town or village, 
Municipality, Township, County, State or Territory to 
give employment to any idle man applying for work, and 
that the rate be not less than one dollar and fifty cents 
per day for common labor and three dollars and fifty 
cents per day for team and labor, and that eight hours 
per day shall constitute a day's labor under the provisions 
of this act. 

53d Congress, 2d Session, H. R. 7438, June 12th, 1894 

A BILL to provide for the improvement of public 
roads, and for other purposes. 

Be it enacted by the Senate and House of Representa- 
tives of the United States of America in Congress assem- 
bled, That the Secretary of the Treasury of the United 
States is hereby authorized and instructed to have en- 
graved and have printed, immediately after the passage 
of this bill, five hundred millions of dollars of Treasury 
notes, a legal tender for all debts, public and private, said 
notes to be in denominations of one, two, five, and ten 
dollars, and to be placed in a fund to be known as the 
"general county-road fund system of the United States," 
and to be expended solely for said purpose. 

Sec. 2. That it shall be the duty of the Secretary of 
War to take charge of the construction of the said general 
county-road system of the United States, and said con- 
struction to commence as soon as the Secretary of the 
Treasury shall inform the Secretary of War that the said 
fund is available, which shall not be later than sixty days 
from and after the passage of this bill, when it shall be 
the duty of the Secretary of War to inaugurate the work 
and expend the sum of twenty millions of dollars per 
month pro rata with the number of miles of road in each 
State and Territory in the United States. 

Sec. 3. That all labor other than that of the office 
of the Secretary of War, "whose compensations are already 
fixed by law," shall be paid by the day, and. that the rate 
be not less than one dollar and fifty cents per day for 
common labor and three dollars and fifty cents per day 
for team and labor, and that eight hours per day shall 
constitute a day's labor under the provisions of this bill, 
and that all citizens of the United States making appli- 
cation to labor shall be employed. 

The Chairman. Mr. Coxey, if you are ready to pro* 
ceed we will hear you. 



THE COXEY PLAN 21 

Mr. Coxey said: Mr. Chairman and gentlemen, I 
think it essential, in order to show the necessity for the 
passage of these proposed bills, to do as a physician does 
in attending a patient with some dangerous disease. The 
first thing the physician does is to call in his neighboring 
physicians and hold a consultation, and diagnose the dis- 
ease; then the diagnosis will indicate satisfactorily to 
them the medicine that is necessary to be administered 
in order to restore the patient to health and vigor. We 
find throughout our , country today a diseased condition, 
and I will try to diagnose the disease for you. 

It will take us back to the spring of 1893. We find 
at that time we had $1,500,000,000 of all kinds of actual 
money in circulation. A thousand millions of that actual 
money was in the hands of the people, the farmers, and 
laborers, and miners, and merchants, and in the mer- 
chants' tills, making their exchanges. After they paid 
their debts they took their surplus earnings and deposited 
those earnings in the banking institutions of the country. 
Then the bankers loaned these deposits or earnings of the 
people out to the manufacturers or employers of the peo- 
ple. The balance of actual money amounted to $500,000,- 
000, which was held by the banks as a bank reserve, and 
upon this bank reserve the banking institutions of the 
country had created another kind of money, which con- 
sisted of commercial paper. That commercial paper is 
what the manufacturers took in payment for their prod- 
ucts. 

For instance, suppose a steel manufacturer of Pitts- 
burgh takes a contract to deliver steel and when he de- 
livers that steel he agrees to take in payment for the 
steel notes running from three to four months' time. 
That note is answering the purpose of money, the medium 
of exchange, because it has exchanged the products from 
the steel manufacturer to the jobber or consumer who 
purchases it, just the same as though he had paid the 
actual money for it. 

After delivering the goods and receiving the note in 
payment, the next thing that the manufacturer does is 
to go to the banking institution, taking the notes with 
him, indorsing them, and putting them in his bank book, 
and the banker takes them and discounts them, deducting 
the discount, and credits the manufacturer with the bal- 
ance. Then that is subject to check. Now, the banking 
institutions in 1893 had discounted $4,500,000,000 of that 



22 THE COXEY PLAN 

kind of paper, commercial paper, manufacturers' notes, 
based upon $500,000,000 of bank reserve. There was $9 
of credit money discounted by banking institutions bas^d 
upon $1 of actual money to pay the $9 with. Then, the 
only money that was being used to exchange our com- 
modities was the $1,000,000,000 in the hands of the peo- 
ple and in the banks as deposits. The $500,000,000 of 
bank reserve were to all intents and purposes, so far as 
the exchange of commodities of the country, out of circu- 
lation, because it was held as reserve. 

The money mediums we used to exchange our com- 
modities, were $4,500,000,000 of commercial paper, and 
$1,000,000,000 of actual money— $5,500,000,000 all told. 
Then, in the spring of 1893 England threw $108,000,000 
of securities upon our markets, converted them into gold, 
and commenced the withdrawal of the gold out of the 
country. The great daily newspapers commenced the agi- 
tation that the continued purchase of silver under the pur- 
chasing clause of the Sherman act was causing the gold 
to flow out of the country. These editorials, starting 
originally with the papers of New York, Boston, Phila- 
delphia, Chicago, and all .the great daily newspapers of 
the country, were taken up by the country newspapers, 
and the bank depositors getting the daily and weekly 
papers, reading these editorials, where they saw the num- 
ber of million dollars leaving the country daily and week- 
ly, and the assertion that the cause of it was the contin- 
ued purchase of silver under the purchasing clause of the 
Sherman bill, and if that clause was not repealed it would 
create a panic, because it would drive every dollar of gold 
out of the country — as I say, the bank depositors reading 
these editorials, their minds were prejudiced and framed 
and they became alarmed and rushed to all the banking 
institutions and commenced to withdraw their deposits 
out of the banks, so that the latter part of June and first 
of July, 1893, w r e found this condition: That the manu- 
facturer, who had, previous to that, made contracts to 
deliver his product and take in payment for that product 
notes running for four months' time, went to the bank- 
ing institutions with the notes and the notes were turned 
in to the banker, but the banker said: "Self-preservation 
is the first law of nature, and we must first protect our 
depositors. We cannot discount any more commercial 
paper." 

Now, that condition became general in all banking 



THECOXEYPLAN 23 

institutions of this country, and the result was that this 
confidence money or commercial paper which was being 
used to exchange products up to that time was refused 
by the banking institutions to be any longer discounted, 
and the manufacturer was compelled to close down his 
plant. 

Manufacturers Make Their Own Money 

Now, I want to give two illustrations. I was talking 
with Mr. Schmick, who is secretary and treasurer of the 
Cherry Valley Iron Works of Leetonia, Ohio, where they 
have quite a large plant and employ a great many men, 
and he said: "Mr. Coxey, I do not know what caused 
this business depression, but I know this: when the panic 
came on the Cherry Valley Iron Co. had deposited at 
Cleveland $40,000 to their credit, and I went two or three 
days before pay day and drew a check for $10,000 to get 
the currency to pay the men their money. 

"The banker said to me, 'Mr. Schmick, we can not 
allow you to draw this money out/ 'Why,' I said, 'what 
is the matter?' 'Why/ he said, 'there have been runs 
made upon our bank and all the banking institutions of 
this country, and we have not got the money to cash the 
check/ He waited there two days, and at the end of that 
time the banker, by considerable hustling, raised $6,000. 
He wanted $10,000, and had $40,000 upon deposit, and 
when he found he could only get $6,000, he telegraphed 
to another iron concern in Columbus, Ohio, by the name 
of King, Gilbert & Warner, to send him by express $4,000 
in currency to Leetonia, which he did, and with that 
$6,000 he got from the bank at Cleveland he went back 
to Leetonia and was able to pay his men, but he called his 
men ifp after paying them and told them what had hap- 
pened. 

He said to them, "I think it would be better to close 
down our plant, because there is a panic in the country 
now. It is impossible to get money to pay you, and when 
the next pay day comes I may not be able to get the money 
to pay you, and you will be dissatisfied and make trouble 
for us." The men withdrew and went into their labor or- 
ganization and held a consultation, and their committee 
went back and reported to Mr. Schmick that they thought 
he should run on if he had orders; that they would work 
for him, and if he could not get the money for them by 
pay day they would work and wait until they got it. That 
is one illustration. 



24* THE COX EY PLAN 

Now I will give you another one. Russell & Co., a 
manufacturing concern of Massillon, Ohio, when the panic 
came on had contracts to deliver steam engines for manu- 
facturing plants throughout the country. They delivered 
the engines, and after the delivery they received notes in 
payments for the engines. They took the notes to the 
banking institutions and were unable to get them dis- 
counted, and the result was they could not get money to 
pay their men, and they were compelled to close down their 
plant, and after being closed down over six weeks, throw- 
ing 800 men out of employment in the city of Massillon, 
where I live, the only way they could start up their plant 
was by issuing their own money, and that is what they 
did. Here is one: 

No. 18858 Massillon, Ohio, August 12, 1893. 

December 20, 1893, after date 
{fe«f For Value Received, RUSSELL & CO. 

^K I Promise to Pay J. W. McClymonds, or bearer, 

^A 0NE DOLLAR, 

At their office, with interest at 6 per cent, to maturity only, 

J. W. McClymonds, 
C. M. Russell, Treas. 

Sec'y 

I am not presenting this as making any fight against 
Russell & Co., only to corroborate what I say is the cause 
of the present business depression. They closed down 
their plant and the only way they could start it up was 
with yellowbacks instead of greenbacks. Let me say 
something else in that connection which I think is strong 
proof of my claim as to the cause of the present business 
depression. J. W. McClymonds, treasurer of Russell & 
Co., is also president of the Merchants National Bank. 
C. M. Russell, who signs himself as secretary of Russell 
& Co., is a director in the Union National Bank of Mas- 
sillon. You all know that the presidents and directors 
of banking institutions say whose paper shall be dis- 
counted in their institutions. 

Now, if those two men connected with Russell & Co., 
delivered products and took in payment notes — you know 
that all of the property of the men giving the notes is 
back of the notes — and then indorsing these notes with 
the name of Russell & Co., that puts Russell & Co. back 
of that, and when they take these notes to a banking in- 
stitution which they control and are unable to get their 
own notes discounted in their own institutions, how can 
you expect a manufacturer who has no influence with a 



THECOXEYPLAN 25 



banking institution to get notes discounted? Does it not 
corroborate and prove conclusively that that which has 
closed the manufacturing plants down* is on account of 
the manufacturers not being able to get their paper dis- 
counted, and to get actual money to continue their busi- 
ness? // that is the case the issue ivhich was fought last 
fall on a fear of the repeal of the tariff was a false issue. 
That is the point I make, and it was simply done, I be- 
lieve, to divert the minds of the people from the real 
cause — the money question. 

There is something else in connection with Russell 
& Co., and that is this: Mr. Russell told me within the 
last three weeks that they had $1,000,000 of farmers' 
notes in their safe. They also manufacture threshing 
machines and they take in payment the notes of the 
farmers and whoever w r ill buy of them; and he said they 
had $1,000,000 in their safe and he could not tell any- 
thing about the value of them whatever. He did not 
know whether he would get 10 per £ent. or 25 per cent., 
or what; and he also told me something else in connec- 
tion with it — that they had mortgages upon the crops of 
farmers in Oregon and that the price of the product was 
so low they did not harvest the product but allowed 
it to rot upon the field. That is something else which I 
think deserves the attention of you gentlemen. 

What the Panic has Cost the Country 

Now let us see how that has affected the price of the 
products of the country — the fact of the manufacturing 
plants being closed down. It has created an army of un- 
employed numbering from 3,000,000 to 4,000,000 people — 
say 4,000,000 of people. Now 4,000,000 .of people as 
heads, of families means from 15,000,000 to 16,000,000 
people dependent upon those 4,000,000, and adding the 
two together you have 20,000,000 of people who used to 
be consumers and producers of commodities out of the 
market; because when a laborer is thrown out of employ- 
ment upon which he depends for a livelihood, he can not 
purchase the money to buy the necessaries of life. Is 
there any further reason for the fall in the price of wheat 
down to 50 cents a bushel, and the same way with wool 
to 12 cents a pound, because these 20,000,000 of people 
have been stopped from purchasing and consuming? 

Then, the question of horses comes up. The farmer 
wonders why the price of his horses goes down and thinks 
there may be an overproduction. But that is not the case. 



26 THE COXEY PLAN 

Let us look and see who it was who purchased the farm- 
er's horses four or five years ago, when he got $200 to 
$225 for a horse. It was the manufacturer. What did 
the manufacturer do with the horses? He used them for 
conveying the raw material from the railroad to his plant 
and the finished product from his plant to the depot. 
They were the people who were buying them, and in an- 
ticipation of the wants of the manufacturers of this coun- 
try the farmers commenced to raise and produce horses 
and get them ready for the market, and in 1893 they had 
them ready to sell, but when the farmers put them upon 
the market, who did they find were their competitors? 
Why, the very men whom he anticipated would be the 
buyers. 

The manufacturer is now his competitor because he 
is a seller, not because he is producing horses, but because 
he has no longer use for horses, as his plant remains idle 
for a number of months and his interest account must be 
cut down in some way, and so he sells these things; he 
realizes upon them upon the open market, and when the 
farmer goes to sell a horse he comes in competition with 
the man whom he supposed would be a purchaser then. 
Of course, the demand being taken away for the horse, 
the price is bound to fall. It is true with every branch. 
You will find it in the steel business, in the iron business, 
in the wool business, in the clothing business, and every 
branch will be affected the same, because you have taken 
the purchasing power away from the consumers. 

Now you have seen this system fail. Why? Be- 
cause we had business based upon $1 of actual money and 
$9 of credit money, and I am not taking into considera- 
tion the hundreds of millions of commercial paper that lie 
locked up in safes of the manufacturers that are not used 
at all, but simply from the view of the statement of 
$4,500,000,000 of discount. 

Now then I claim the necessity for these two bills 
which have been referred to your, committee is apparent. 
The reason I claim the necessity for the passage of these 
bills is this: We should get down to a system of actual 
money instead of credit money or confidence money, and 
this will bring it about. The first bill is called the good 
roads bill, and is known as that. That calls for Congress 
to authorize the issue of $500,000,000 of full legal tender 
Treasury notes, making them full legal tender for 'all 
debts, public and private, and appropriate to each State 
and Territory pro rata with the number of miles of road 



THE COXEY- PLAN 27 

in each State and Territory at the rate of $20,000,000 
per month to set these 4,000,000 of idle and unemployed 
people to work in macadamizing the roads all over the 
United States. I know they are needed pretty badly at 
Pittsburg, and I know they are needed nearly as badly in 
the vicinity where I come from. 

There is a provision in this bill which says tnat all 
labor shall be done by the day, and not by contract labor, 
and that the rate of wages shall not be less than $1.50 
for a day of eight hours, and $3.50 a day for a team and 
labor. This, in my opinion, would settle the eight-hour 
question, because it would bring about this condition : that 
the Government would stand ready at any and all times 
to give employment to the idle and unemployed at a rate 
not less than $1.50 for a day of eight hours, and thus no 
manufacturer or firm would be able to hire a single indi- 
vidual for less than what the Government would be willing 
to pay, which would be $1.50 a day for a day of eight 
hours. 

Now the other bill, the non-interest bearing bond bill, 
calls for Congress to grant to the States, counties, town- 
ships, municipalities, towns, or villages the right to issue 
bonds, without interest, not to exceed one-half of the 
assessed valuation of their property, to run for twenty-five 
years, and to deposit those bonds with the Secretary of 
the Treasury at Washington as security for the repayment 
of the money. Then that it shall be mandatory upon the 
Secretary of the Treasury to authorize the issue of the 
face value of these bonds in full legal tender money, keep- 
ing out 1 per cent., the actual cost of making the money, 
and forwarding 99 percent, to the State, county, munici- 
pality, 'township or village which issues its bonds and de- 
posits them with the Secretary of the Treasury as security 
for the repayment of the money, they agreeing to pay 
this money back to the general government at the rate of 
4 percent, per annum, all payments to be applied upon 
the principal, and in twenty-five years the bonds will be 
cancelled and the municipality will be free from debt. 
Now, I would like to illustrate: 

Mr. Dalzell. What is the amount contemplated will 
be issued by that? 

Mr. Coxey. Not to exceed one-half of the assessed 
valuation of the property. 

Mr. Dalzell. Have you any idea or can you give us 



28 THECOXEYPLAN 

any approximate figures, of the amount that will be issued. 
Take the last census for instance? 

Mr. Coxey. No ; I can not. 

Mr. Dalzell. You have not looked into that? 

Mr. Coxey. I cannot do that for this reason. My 
idea of the money question is simply this; we should fur- 
nish a sufficient volume of money for the demands of 
trade, and you will see as I go along, I will take up that 
question and make an illustration which I think, will make 
it clear to you. 

Mr. Dalzell. I am trying to understand this thing, 
and I understand that under your first bill we will have 
$500,000,000, and I would like to know how much addi- 
tional we will have under the second bill. 

Mr. Whiting. I understand that would be determined 
upon by what the municipalities would decide to do, as to 
whether they would issue bonds or not. Only townships 
which would want to improve the roads would take ad- 
vantage of the law, and other townships might say that 
they did not care for them, so it would lay entirely with 
the judgment of the township. 

Mr. Coxey. Yes, sir. 

The Chairman. As I understand, the only limit is 
one-half of the total assessed valuation of all property in 
•the country? 

Mr. Coxey. Yes, sir. 

Mr. Dalzell. That, I suppose, is to be determined at 
the time the bonds were issued? 

Mr. Coxey. Yes, sir. 

The Chairman. Do you allow the counties to issue 
and also the municipalities within the counties — 

Mr. Coxey. Yes, I will reach that point — 

The Chairman. Then, will there not be danger of 
duplication ? 

Mr. Coxey. I will answer this way, Mr. Chairman. 
I -do not anticipate a changing of the present bond sys- 
tem only so far as to abolish the interest. Our present 
system allows all towns, villages, townships, municipal- 
ities, counties and states to issue their bonds bearing 
interest. 

Mr. Dalzell. A matter of regulation by state law. 

Mr. Whiting. Not to exceed 5 per cent. 

Mr. Coxey. There are different regulations in differ- 
ent states. In order to illustrate this I will take a munici- 
pality that is assessed $200,000; then it would be allowed 



THECOXEYPLAN 29 

to issue bonds not to exceed one-half of the assessed valua- 
tion, which would be $100,000, and without interest, run- 
ning twenty-five years. They would forward that bond to 
the Secretary of the Treasury and deposit it with him as 
security for the repayment of the money, which is similar 
to what the national banking institutions are doing now 
with the Government bonds. Then he would authorize 
them to issue $100,000 of full legal tender money on this 
bond, keeping out $1,000 to pay the engraver, printer, 
paper manufacturer, etc., for making the money, and he 
Would forward $99,000 to the treasurer of the munici- 
pality, to be paid out for making all manner of public im- 
provements, such as street car lines, electric light plants, 
waterworks, putting in sewers, paving streets, building 
school houses, market houses and making every manner 
of public improvements that would be a convenience and 
a comfort to the people of the municipality where the bond 
was issued. Now the question arises — 

Basis and Redemption 

Mr. M'Millin. How do you provide for the redemp- 
tion of these bonds? 

Mr. Coxey. I will tell you in a moment. The first 
question in a man's mind is, What is back of this money? 
That is always the first question when you bring this up. 
You have issued a bond for $100,000, and back of that 
bond is $200,000 of assessed property. There is $2 of 
property back of every dollar you have made and put into 
circulation before you have made any improvements. Then 
you start the idle and unemployed to work in creating 
value in the public improvements, and the city treasurer 
will pay money out to men who render the services and 
create • the value ; thus, you expend $99,000 in creating 
$99,000 of value in the shape of public improvements, 
which is added to the $200,000 of assessed value, and you 
have increased the value of your money when you put it 
into circulation for services rendered and value created 
50 percent, over when you commenced, so when you finish 
your improvements you have $3 of property back of every 
dollar of circulation, whereas you had $2 when you com- 
menced. 

Now, as to the redemption about which the gentleman 
on the right asked me. The first year they levy a tax 
rate to raise 4 percent, per annum to be applied upon the 
principal, the same as they do now in levying a tax rate 
of 6 percent, per annum, to be paid in interest, while they 



30 THECOXEYPLAN 

sun owe the principal. You raise the taxes, you send 
them in an express package to the Secretary of the Treas- 
ury, and he takes the amount of taxes there, just the same 
as the postmaster takes a stamp, and cancels it, and that 
money has been redeemed, and through taxation — the only 
true redemption of money. He credits that $4,000 4 per- 
cent.,- upon the principal of the bond, which reduces the 
principal of the bond down to $96,000 the first year, and 
you still have back of that $96,000 in circulation $299,000 
of value. 

Mr. M'Millin. What do you do with the $4,000 sent 
to the Secretary of the Treasury? 

Mr. Coxey. It is cancelled and withdrawn. 

Mr. M'Millin. You provide for cancellation after 
return ? 

Mr. Coxey. Yes, sir. 

Mr. M'Millin. And you provide no metallic redemp- 
tion at all? 

Mr. Coxey. No, sir; no metallic redemption. 

Mr. M'Millin. In the event a county or municipality 
defaults in the payment, where do you provide suit shall 
be brought for the enforcement thereof? 

Mr. Coxey. The property belongs to the Government 
because it has got a bond on it. 

Mr. M'Millin. But you see the Government would 
want the money; it would not want to run every town in 
the country. 

Mr. Coxey. It is simply a part of the Government. 
Every municipality and every town is a part of the Gov- 
ernment, and it is simply furnishing the people — 

Mr. M'Millin. But you do not provide where any suit 
is to be brought or litigation by which they can be forced 
to pay when they fail to pay? 

Mr. Coxey. Not any more than under the present 
bond system. 

Mr. M'Millin. If there should be no provision would 
not that necessitate the closing of the transaction in the 
Federal court, as that is the only court of the Government 
of the United States? 

Mr. Coxey. I presume it would. 

Mr. Dalzell. All this if I understand you, proceeds 
upon the assumption that it is a proper function of the 
Federal Government to authorize loans by municipalities 
on various improvements? 

Mr. Coxey. I will illustrate that, Mr. Dalzell* right 
along in this argument. Yes, sir; that is the stand I take. 



THE CO XEY PLAN 31 

Advantages Over the Present Bond System 

Mr. Dalzell. For instance, under the laws of Pennsyl- 
vania, if a municipality is confined in issuing its bonds 
to 5 percent, of its assessed valuation, you would overturn 
that law by a Federal law which authorizes them to issue 
50 percent? 

Mr. Coxey. Yes, sir. Now, the second year they levy 
another tax rate to raise another 4 percent., the amount 
they agreed to pay back to the General Government an- 
nually. This is sent to the General Government, to the 
Secretary of the Treasury, who cancels it, and you have 
reduced your principal in two years to $92,000 and you 
still have your $299,000 of value back of the $92,000 in 
circulation. By continuing that process, paying 4 percent, 
per annum upon the principal, at the end of twenty-five 
years your bond is handed back by the General Govern- 
ment, and the General Government says to the States, 
counties, municipalities, townships and villages, "you have 
done your part and we now cancel the bond." They are 
free of debt. 

Take the present system. How does the municipality 
borrow money ? They call the council together and author- 
ize the issue, say, of $100,000 of bonds, if they need that 
much money, provided they have got property enough. 
Of course the limit is smaller than what I give, but I 
only make that limit so as to furnish the money in case 
they need it. I do not think they w T ill need it, but I do 
claim if they need the money they ought to have the priv- 
ilege of getting the money, and they will not borrow more 
money than they need from the simple fact that they 
are taxed annually 4 percent, to pay back, but these 
payments go down upon the principal. Now, say the 
council authorizes the issue of $100,000 of bonds and they 
agree to pay 6 percent, interest upon the bonds and the 
bonds are to run twenty-five years. They deposit the 
bonds with some banker or money lender. They receive 
the money upon the bonds and then they go and tax the 
people and raise 6 percent, interest upon that $100,000, 
$6,000 for twenty-five years, and at the end of twenty-five 
years they have paid $150,000 in interest, and then they 
are just where they started, because they still owe 
$100,000. 

If the municipality under the present law can issue 
bonds and tax the people to pay 6 percent, interest upon 
those bonds for twenty-five years, it strikes me it should 



32 THE COXEY PLAN 

be able to pay 4 percent, upon the principal without inter- 
est, and under this system, I believe, if adopted, it would 
go a long way toward abolishing municipal taxation. You 
take large cities like Philadelphia, New York, Pittsburg, 
and the majority of the great cities, the revenues from the 
street-car lines, waterworks, electric and gas plants would 
more than pay the running of the municipality and pay 
back to the General Government this 4 percent, per annum 
upon the amount that they borrowed from the General 
Government to pay for these expenses, and therefore it 
will not only lower the tax rates, if not altogether abolish 
the tax rates in municipalities throughout the country, but 
it would have a beneficial effect upon the city manufac- 
turers, because my friend here in front realizes this fact, 
that a great many manufacturing plants are driven out of 
large cities on account of excessive taxation. They are 
driven to seek places in the country, on the suburbs of the 
city, that are inconvenient to people who want to go to 
the plant to get material and repairs and all that kind 
of thing, and this will take away that bad feature of driv- 
ing the manufacturers out into the country.. 

A township under this bill can borrow money from 
the General Government and use the money to build a 
schoolhouse and make township roads. The counties can 
put out county bonds and deposit those bonds with the 
Secretary of the Treasury and build a courthouse and 
make improvements; and I would like to illustrate that, 
because in my own county, Stark, our county commis- 
sioners have authorized the issue and have issued $200,000 
of bonds, bearing 5 percent, interest, to run twenty years. 
They have sold those bonds, and they have the cash to be 
paid out to build a courthouse. 

Now, they will tax the people of Stark county 5 per- 
cent, on the $200,000 for the next twenty years, which will 
be $200,000, and we will be where we are today, because 
we will still owe the $200,000 of the principal, and I do 
not know where we are going to get the money to pay it. 
Under my plan you would issue bonds running for twenty- 
five years without interest, deposit the bonds with the 
Secretary of the Treasury, and receive the face value of 
that bond in full legal tender Treasury notes, keeping out 
$2,000, the actual cost of making the money, and the Sec- 
retary of the Treasury would forward $198,000 to the 
county treasurer of Stark county to be paid out for build- 
ing that courthouse. Then they would tax back out of the 



THECOXEYPLAN 33 

county $8,000 each and every year to be paid and applied 
upon the principal, and at the end of twenty-five years 
our bonds would be canceled. Now we are taxing out of 
the people of Stark county $10,000 each and every year, 
and at the end of twenty years we will still owe the 
$200,000 in bonds. That illustrates the county loan. You 
go up to the States and see how beneficial it would be to 
the States. 

Shall the Government Own the Railroads? 

The great issue, I believe, which is before the Amer- 
ican people today is whether the railroads are going to 
own this Government ©r the Government is going to own 
the railroads. I can show you plainly under this how you 
can buy up the railroads of every State and Territory, and 
pay for them, and the people will not be taxed one cent to 
pay for the railroads, and in order to do that I will illus- 
trate how they organize a railroad corporation, because I 
think it is essential to do so. It requires half a dozen 
men to organize a railroad corporation. They get together 
and organize it. The next thing is, they go to the State 
capital and get a franchise, and that franchise gives the 
right of way through every man's property to the rail- 
road. 

They start an engineer to surveying the railroad, and 
he goes to a farm of a farmer, and gets over the fence and 
orders a stake put here and a stake put there, and prob- 
ably one put right up to the house, and by that time the 
farmer comes out and he says to the engineer, "What are 
you doing here?" The engineer says, "J am staking out a 
railroad." The farmer says, "Where are you going to 
run it*?" And the engineer replies, "I am going to run it 
right straight through your house." The farmer becomes 
angry, and he drives the engineer off his farm. The engi- 
neer goes and reports to the railroad corporation, and 
states that they cannot go through the farm. The attor- 
ney of the company goes to the court and petitions the 
court to appoint a jury or commission to assess the value 
of the farm. They do that, and they go back and render 
a verdict of $700 damages done to the farmer against 
the railroad company. What does the railroad company 
do? They take $700 of lawful money issued by the Gen- 
eral Government and tender that in court and say to the 
man, "Now move out." And if he does not move out they 
get a sheriff and move him, and the law gives them that 



34 THE COXEY PLAN 

right. Now, that man had a deed to that property; he 
owns it, and where is the law for it? 

Under the Constitution and law, which says it is for 
the common benefit of the whole people of this country 
that that railroad should be built right straight through 
the farmer's farmhouse, now, under the same law and 
Constitution that guarantees equal rights to all and special 
privileges to none, I claim that we can condemn the rail- 
road property of this country and take it. 

The Government Can Buy the Railroads Without Taxing 

People 

Now, how can that be done? Go into the courts after 
the passage of the non-interest-bearing bond bill and peti- 
tion the court to appoint jurors or a commission to go 
and view the railroad property of the States and Terri- 
tories, and, after they have viewed it, to render their ver- 
dict in the courts and state the number of millions of 
dollars necessary to pay for them, and then tender them 
lawful money as issued upon bonds without interest run- 
ning twenty-five years, based upon all the value of the 
States; deposit those bonds with the Secretary of the 
Treasury and get the face value of them, less 1 percent, 
for making the money, in full legal tender money, and 
then take that lawful money and tender it into the court 
which will be lawful money, and get deeds for these rail- 
roads, and then go to the railroad magnates and tell them 
to move out, just the same as they told the farmer under 
the same law and same Constitution. 

How beneficial that would be to the manufacturers 
and business men and laborers of the country! Under 
this system you will have abolished dividends upon rail- 
road stock, including all the water, and also interest upon 
railroad bonds. No more interest upon railroad bonds 
then, and the revenues and freight receipts from the rail- 
roads would more than pay 4 percent, per annum back to 
the General Government which you have agreed to pay 
upon the amount borrowed from the General Government, 
and in twenty-five years your bonds would be cancelled 
and you would be free of debt and the freight rates could 
be lowered much more, and under that system alone, by 
abolishing dividends upon railroad stock, interest upon 
railroad bonds, you stop this drain of gold that is leaving 
our country now daily and weekly to pay dividends and 
interest abroad. I say that this Government has the right 



THECOXEYPLAN 35 

to make money which would be doing this, and save that 
$300,000,000 annually to the people of this country. 

Elasticity of Money and Automatic Regulation of the 

Supply 

Now, the next question comes, How are you to put 
the money in circulation? I claim this non-interest bear- 
ing bond proposition will act in regulating the speed of 
the business of the country exactly the same as the gov- 
ernor does the speed of a steam engine. When I was a 
young man 16 years of age, for ten years I ran a station- 
ary engine in a rolling mill, and we set the governor to 
run the engine at 60 revolutions a minute. I put the 
steam on, and the engine commenced to start, and when it 
commenced to get up to 60 revolutions a minute the gov- 
ernor balls went up and began to close the valve, and when 
it closed the valve the engine slackened down to 59 revolu- 
tions, and then the balls would drop and start to working 
the valve in the other direction; so it worked up and 
down, regulating the speed of that engine between 59 and 
60 revolutions a minute. This bill will act just the same 
and in this way: 

There are 4,000,000 idle and unemployed people in 
this country; 1,000,000 of them always work upon public 
improvements when they are to be made, but there are 
none to be made now, because we have not the money to 
make them. Three milions of them work in manufactur- 
ing plants and upon farms, and they are idle for the same 
reason that the farms are not profitable; and the same 
way with manufacturing plants; they are closed down. 
The 4,000,000 of men will start to work after the passage 
of this bill, and at the end of the first eight hours they 
have created, as they get not less than $1.50 a day, $6,000,- 
000 of value in the establishment of pubjic improvements. 
Now, as you create value by great public improvements 
you coin that value into a medium of exchange called 
money of full legal tender value for all debts, public and 
private, and you pay those 4,000,000 of men for the ser- 
vices they have rendered in creating that value. 

The first evening these 4,000,000 of men take $6,000,- 
000 of the representative of the value they have created in 
that eight hours and they go to the various stores of the 
country and they purchase of the surplus products of the 
country. They take them out of the stores and leave in 
their place $6,000,000 of legal tender money; they go to 



.36 THE COXEY PLAN 

work the next morning ; having consumed some of the 
products — they have had a good breakfast, say the first 
in a year — they work another eight hours, and at the end 
of that eight hours they have created another $6,000,000 
of value, for which the Government gives them $6,000,000 
of full legal tender money, representing the value of these 
improvements which they have created, and they purchase 
another $6,000,000 of provisions. In one month's time 
they have created $140,000,000 of value in the shape of 
public improvements, and the Government has coined that 
into $140,000,000 of medium of exchange, representing 
the value of the improvements they have created, and 
these men have purchased and paid for and consumed 
$140,000,000 of the surplus products of the country. 

Now, if we create a demand and work off the surplus 
products, the merchants will write to the manufacturers 
and the farmers for, more goods, and tell them that they 
want to pay for those goods with money; that they do 
not want any longer to give their notes, running for three 
or four months. It may be that manufacturers read that 
with surprise, because they have been accustomed to do 
business by receiving and tendering notes in payment, 
and, they say, we can start up now, because we do not 
have to ask the banks to discount commercial paper, but 
we will start up and pay manufacturing expenses, and 
when we deliver the goods we get money in payment for 
them. 

They try to start the plant, and they find somebody 
has hired the men. Where do they find the men? They 
find 3,000,000 who have worked in the plants are now 
working on public improvements, opening the valve at 
Washington and letting the money in to start the whole 
wheels of industry going again, and they have done it. 
They call 3,000,000 off the public improvements because 
the engine has gotten up to 60 revolutions per minute with 
4,000,000 men on public improvements. They take 3,000,- 
000 off and then the engine slacks down to 59 revolutions, 
when the 1,000,000 left there enables the engine to run 
from 59 to 60 revolutions, and by that system it equalizes 
the speed and keeps that engine running between 59 and 
60 revolutions a minute all the time this bill is left upon 
the statute books. 

Then you have taken away by the adoption* of that 
every chance of any possible stringency in the future. 
Why? For this reason, if there is a strike among the coal 



THE COXEY PLAN 37 



miners, or the employes of some manufacturing establish- 
ment have got a complaint, the men idle and unemployed 
can go upon the public improvements, and they can get a 
fair return for a fair day's work, and if a manufacturing 
plant burns down they have a place to go to work and 
create a demand, to supply which these plants will have 
to be set to work. Another strong feature of this is this 
question of what we call over production, being surplus 
production, from the simple fact the purchasing power 
has been taken away from the people. Now you will give 
them purchasing power to consume this surplus product 
instead of producing something that will be put upon the 
market and come in competition with an already overbur- 
dened market. This is not a marketable improvement. 
You do not sell this or put it upon the market to sell it. 
It simply improves the states, counties, townships, munici- 
palities and villages for the general good of all. You do 
not sell the improvements. 

What Money Is 

Now as to the question of money. I wish to touch 
upon that because they tell you that you have got to have 
money which is redeemable in gold. Now, the kind of 
money I have advocated here today is not only redeemable 
in gold, but in silver, or iron, or copper, or wheats or rye, 
or oats, or cotton, or wool, and everything else that is 
produced in this country, including labor. Then you have 
got a stronger money than that which is only redeemable 
in gold, because it is redeemable in gold and everything 
else. Let us analyze that part. You start two men to 
work. Say one man works upon a highway and he works 
eight 'hours, and at the end of that eight hours he has 
created $1.50 of value in improvements, and the govern- 
ment coins that into $1.50 of legal tender money. It pays 
him at the end of that service $1.50 of full legal tender 
paper money, which is the representative of the value that 
he has created. He has it in his hand. It is an order for 
all kinds of goods in this country. 

Suppose the second man is a man working in a gold 
mine, and he works eight hours, and at the end of that 
time he brings up the actual value in his hand what is 
called the intrinsic value of $1.50 in gold. Now, say these 
two men start for the grocery store and purchase $1.50 
of groceries each. They purchase these groceries and then 
they are indebted to the groceryman $1.50 each. The man 
who works on the highways says, "I want to pay for 



38 THE COXEY PLAN 

those groceries," and he tenders the legal tender note of 
the government, and the groceryman says, "I will not take 
it." The man who has the gold tenders his gold in pay- 
ment to the groceryman, and the merchant says, "I will 
not take that." 

What do they do? They go to that great arbiter, the 
justice of the peace, who settles any differences of $1.50 
and is the agent of the government to that extent, and the 
three men, the merchant and the men who have created 
the value, enter the justice of the peace office, and the 
merchant says to the justice of the peace: 'These men 
have each purchased $1.50 worth of groceries, and they 
have not paid me for them." The man working upon the 
highways says: "I wish to pay for mine." And he ten- 
ders his full legal tender paper money that he received 
from the government to the squire, and the squire takes 
it and sees the act of Congress and engraving upon it and 
the stamp upon it, which says: "This is full legal tender 
for all debts public and private," and he looks up at the 
merchant in surprise and says: "Merchant, that settles 
your account," and the merchant says, "I will not take 
it." The justice says: "Then your account is settled any- 
way, because all you can get is what Congress says is legal 
tender for debts." The merchant changes his mind and 
takes it then. 

How about the man who mines the gold? He says: 
"I want to pay the groceryman," and he tenders the gold 
to the squire. The squire looks at it and says: "What is 
that?" He says: "That is gold, and that is what Sherman 
and Carlisle say is money; money is gold, gold is money, 
and gold is God's money." The justice of the peace says: 
"Take that to the Philadelphia mint and get the stamp of 
the government on it, just the same as the paper has, 
and then you can tender it in payment of debt, and not 
until then." He does that, and he brings it back and pays 
the debt. Now, what was used about that gold and paper 
money in paying that debt? It was the legal tender value, 
and that is all you can use in money. 

There is another question comes up, and that is, how 
about settling foreign indebtedness. Mr. Blaylock, of 
Blaylock & Blynn, hatters, of Philadelphia, in conversa- 
tion I said to him, in talking over this question, "Mr. 
Blaylock, have you not got a lot of accounts back here you 
would gladly take full legal tender American money for?" 



THil COXEY PLAN 39 

He said: "You are right." I said: "Provided you have 
got that money for the hats you have sold and you take 
it over to a bank of deposit, could not you buy a bill of 
exchange on England in payment of imported goods?" He 
said: "Certainly." I said: "Where is the necessity of 
gold for money here? You must part with your labor to 
buy it, and first part with the labor to buy paper money 
issued by the government, because you have got to render 
services before you can get it. You cannot get it like the 
banks now. They are not rendering services for the 
money they get; there would have to be services rendered 
and value created for this money, and then you can get 
the gold; if we need gold to go to Europe, buy that com- 
modity, because when it leaves this country it simply goes 
as a commodity, as wheat, or cotton, or any other produc- 
tion in this country which is shipped to Europe." 

Now, if there are any questions which you gentlemen 
feel like putting to me on this question, I will gladly an- 
swer them to the best of my ability. I do not claim to 
know everything on the subject, though. 

Mr. Whiting. This plan would eliminate interest alto- 
gether ? 

Mr. Coxey. It would, as far as public improve- 
ments — 

Mr. Whiting. But would it not eliminate all interest? 
Mr. Coxey. Well, no; I do net think it would. 
Mr. Dalzell. You say it would destroy railroad divi- 
dends, and all that sort of thing? 

Protection and Revenue 

Mr. Coxey. It forces the people who now have their 
money invested in railroad enterprises, in telegraphs, tele- 
phones, to put their money into individual enterprises in 
developing the country, for example; and here is one im- 
portant feature I failed to mention, and that is that there 
are $5,000,000,000 of English money invested in our dif- 
ferent securities, trusts and combinations here. We are 
taxed from $250,000,000 to $300,000,000 annually in inter- 
est and dividends for the use of a thing that we ought to 
make ourselves, money. That is what this bill will do. 
That is the kind of protectionist I am; I want to drive 
every dollar of foreign money out of this country and 
make the money to do our own business. 

Mr. Dalzell, And buy nothing abroad at all. 



40 THECOXEYPLAN 

Mr. Coxey. Oh, certainly; we will buy something 
abroad ; we will buy more abroad than now. Why ? They 
wonder why the receipts of the government have fallen 
off. It does not appear to me they have struck the root 
of it. If you stop 20,000,000 people from consuming 
commodities, some of which undoubtedly come from 
abroad, that is one thing which would make your imports 
fall off ; it is simply because you have taken the purchas- 
ing power away from 20,000,000 of people altogether, and 
from probably 30,000,000 more 50 per cent, of their pur- 
chasing power has been taken away and that has had an 
influence upon the subject of imports into this country, 
but here is the question of money. 

We are at the mercy of English money lenders now. 
At any time they can create a panic, if they wish to do 
so, by throwing $200,000,000 or $300,000,000 of securities 
on the market, converting them into gold and taking the 
gold out of the country. There would be one way of 
stopping the drain of gold upon the treasury if the secre- 
tary of the treasury would use the prerogative that he 
has, and that is to determine that he has the right to 
pay in any kind of lawful money issued by our govern- 
ment, and that when there is a legal tender presented to 
the Treasury he has got the right to present in payment 
for that legal tender silver. That would stop the run 
upon the treasury if he commenced paying out in silver. 

Mr. Dalzell. Let me ask this question: Why limit 
the beneficence of your scheme to municipalities? 

Mr. Coxey. I do not. 

Mr. Dalzell. Why should not the individual prop- 
erty owner issue his twenty-five-year non-interest-bearing 
bond and get 50 per cent, of the value of his property in 
this money? 

Mr. Coxey. I will answer that question in this way: 
I under this plan propose to change the system of issue- 
ing bonds to borrow money for municipal improvements. 
That is a great innovation over the present system, be- 
cause it will break the backbone of a monopoly of money 
in this country. I might agree with you that that might 
be a proper thing to do, and I believe it is, but I am not 
talking — ^ 

Mr. Dalzel. I am not suggesting it, but I am simply 
asking why you should limit it to municipalities, and why 
not extend it further? 



THECOXEYPLAN 41 

A Change From the Credit System to a Cash System 

Mr. Coxey. I realize that a man can be too radical 
in anything. I am trying to accomplish something here 
that will be beneficial to the people of this country, and 
I am satisfied that it will furnish the money that is nec- 
essary to do the business of this country upon a cash 
system. 

Mr. Whiting. And you propose to be conservative? 

Mr. Coxey. Yes, sir; I do. I propose to substitute 
a cash system for a credit system, and we have seen the 
result of the other, the credit system, fail in the last 
eighteen months. 

Mr. Dalzell. You just draw the line upon munici- 
palities ? 

Mr. Coxey. No; townships 

Mr. Dalzell. No; I mean municipal institutions, 
whatever they are; that is where you draw the line be- 
tween radicalism and conservatism? 

Mr. Coxey. Yes, sir. 

Mr. M'Millan. Has it occurred to you there is a dan- 
ger by the possession, operation, and ownership by the 
Government directly of all the railroads in the country; 
of its telegraphs, its telephones, and its means of trans- 
portation of every kind that an Administration once in 
power with such authority in its hands to subvert the 
Government and prevent it ever being ousted would ulti- 
mately result in a subversion of the G6vernment? 

Mr. Coxey. No, sir; I do not. I do not understand 
anything of the kind. 

Mr. Whiting. Your idea is that accumulated capital 
could not lie idle and receive interest but they would have 
to ejigage in business? 

Mr. Coxey. Yes, sir; private enterprises. 

The Chairman. Do you not think the 4 per cent, 
you fix would have some effect in determining the rate 
of interest charged generally? 

Mr. Coxey. Yes; there is a taxation of 4 per cent, 
upon the total amount' issued, but there will be an auto- 
matic valve working so that whatever number of men 
that will work are thrown out of employment by any 
means at all that number will work this valve and keep 
regulating it. 

Mr. Whiting. You think it would require Government 
agents to handle this money? The bankers would have no 
longer an existence? 



THE COXEY PLAN 



Mr. Coxey. Not any more than under the present 
system. I establish a precedent by the National banks. 
Under the national-bank act it requires five individuals 
to organize a national-bank corporation. If they have 
$100,000 of real estate in this municipality and they con- 
clude to start a national bank, they sell that property 
and buy $100,000 of money. Then they sell that money 
and buy another piece of real estate called a Government 
bond. It is real estate because it covers all the resl es- 
tate of the country. That bond bears interest, is non- 
taxable, and they deposit that bond with the Secretary 
of the Treasury, or the Comptroller of the Currency pos- 
sibly. He charges them no tax upon the bond, pays them 
interest, and gives them 90 per cent, of the face value of 
that bond in national-bank notes at a cost of 1 per cent. 
Now, what have they done? They have deposited their 
property — real estate — with the Secretary of the Treas- 
ury, and received interest upon it and 90 per cent, of the 
face value in national-bank notes to take back to the 
municipality to loan out to the very men who bought 
that property, upon their notes bearing interest. 

Then how does the municipality get any of that 
money? Here is this other property which has been 
sold to buy money, to buy bonds, 90 per cent, of the 
face given to them then; they go back to lend upon that 
property again, and tax the people 6 per cent, interest 
upon that bond, and the people are borrowing their own 
money because they have loaned these people 90 per cent. 
of the face value of the bond at a cost of 1 per cent., 
and they go and pay 6 per cent, for the use of that money. 
This will avoid that, and I take the national banks as 
a precedent to establish the non-interest-bearing bond 
bill, because 2 per cent, of the people for thirty-one 
years have had this benefit of depositing this property 
with the General Government, getting 90 per cent, in 
national-bank notes at a cost of 1 per cent. I do not 
ask as much as the bankers; I do not ask that they pay 
interest upon the bonds and pay 90 per cent., but simply 
to give us the face value less the cost of making the 
money. 

Mr. Whiting. Some bankers have found it cheaper 
to use the money they had rather than to use the Gov- 
ernment money at all. 

Mr. Coxey. After they started? After they got 
deposits ? 



THECOXEYPLAN 43 

Mr. Whiting. No ; before. 

The Chairman. The present currency plan we are dis- 
cussing in the House allows a bank, under certain re- 
strictions, to issue 75 per cent, in money upon the face 
of its capital, depositing 30 per cent, of greenbacks and 
Treasury notes, leaving a net advantage to them of a 
little more than 50 per cent, of the capital stock upon 
which they pay an interest or tax equivalent at most to 
1 per cent, one-half of 1 per cent, for the regular ex- 
penses and one-half per cent, for a guarantee fund or 
safety fund. Your plan does away with notes, and in- 
stead of allowing the banks to issue one-half of their 
capital you allow the municipalities to issue one-half of 
their capital? 

Mr. Coxey. Yes, sir. 

The Chairman. So the people, under your plan, get 
the benefit of the loan, whereas under the proposed cur- 
rency plan the bankers get the benefit? 

Mr. Coxey. Yes; only 2 per cent, of the people 
now. 

The Chairman. And then the banker uses the money 
for whatever he can make out of it? 

Mr. Coxey. It allows him the right to charge 6 per 
cent, interest. My scheme is established and precedented 
on the national-bank system to come and demand under 
the Constitution equal rights to all and special privileges 
to none, because it will benefit directly the whole people 
instead of 2 per cent, of the people. 

The Chairman. The rate of interest you have fixed 
is, of course 

Mr. Coxey. It is not interest; it is simply pay- 
ments. 

The Chairman. Entirely arbitrary? It can be made 
5 per cent, for a less term or 2 per cent, for a longer 
term? 

Mr. Coxey. Certainly it could. This is simply a 
matter of compromise with Congress. 

The Chairman. Do you anticipate any danger from 
the contraction of the currency you speak of caused by 
the cancellation of this money when it comes in? 

Mr. Coxey. No, sir; for this reason. I thought I 
made that clear to you before, but I am glad to answer 
that question. I claim that if a manufacturing plant is 
forced to suspend or burn down, or any dire disaster 
happens that throws a thousand men out of employment 



44 THECOXEYPLAN 

oy shutting down, they have always got work on public 
improvements, because you cannot draw so far upon 
your imagination in the future when you will see a 
time when there will not be public improvements needed, 
because as we advance in civilization our wants increase, 
and as our municipalities increase in size they need more 
public improvement, and for that reason you can not 
draw so far upon your imagination that you will not 
see a time when improvements will not be needed. 

The Chairman. You claim for your system the ad- 
vantage of elasticity? 

Mr. Coxey. Yes, sir; I do. 

The Chairman. Which is also claimed by the ad- 
vocates of the proposed currency plan? 

Mr. Coxey. Yes, sir. 

The Chairman. Except they believe that the banks 
will find it profitable to increase the currency when it is 
needed, and you claim that the fact that men are out of 
employment and need work will draw out money when 
it is needed, and when there is plenty of money out every- 
body will be employed elsewhere, so it will not be called 
for from the government? 

Mr. Coxey. Yes, sir; that stops the valve of public 
improvements. When manufacturing plants are closed 
down the valve then opens because the men go on public 
improvements. There is the elasticity; that is the auto- 
matic working of the valve. 

The Chairman. You think the plan by which you 
secure elasticity is a safer one than the banks can pro- 
vide? 

Mr. Coxey. Yes, sir ; I do. I think it is a dangerous 
system to allow 2 per cent, of the population of this coun- 
try to say when you shall have money and when you shall 
not. I know that from actual experience. 

The Chairman. Do you anticipate that your plan 
will arouse any opposition upon the part of the banks? 

Mr. Coxey. Well, a little. Mr. Chairman and gen- 
tlemen, I thank you very kindly for hearing me. 

Thereupon the committee adjourned. 



THE COXEY PLAN 



45 



A Brief History of the 

Commonweal 

The Commonweal Army had its conception in a plan 
devised in December, 1891, for the improvement of the 
public roads throughout the entire country as a means 
of furnishing employment to millions of unemployed men 
driven to enforced idleness by the closing of mines and 
factories, and the introduction of labor-saving machinery. 




THE HOSTS ADVANCING, 1894 

Bulletin No. 1 of "The Good Roads Association of 
the United States," of which J. S. Coxey was President, 
giving text of the Good Roads bill, was issued Dec. 7, 
1893. 

In January, 1894, the Non-Interest Bond plan was 
devised by Mr. Coxey, as a means of supplying the money 
to carry forward the improvement of the public highways 
and all other public improvements. 

Bulletin No. 2 of the association was issued January 



46 



THE COXEY PLAN 



31, 1894, calling for signatures to petitions asking Con- 
gress to enact the Non-Interest Bond and Good Roads 
bills as laws, but having very little faith that Congress 
would do more than pigeon-hole these bills, the idea was 
conceived of presenting the demand to Congress in the 
form of a petition with boots on, and, accordingly, on 
Feb. 28, 1894, Bulletin No. 3 was issued, giving plan of 
organization, March 25, 1894, Easter, as date to begin 
the march to Washington, line of march, design of badges, 




ON THE MARCH TO WASHINGTON, 1894 



rules, notice of meetings to be held en route, and May 
1 as the date of arrival at the Capitol. 

March 25, 1894, Bulletin No. 4 was issued embrac- 
ing General Order No. 1 to the army, when the memor- 
able march was begun, which has taken its niche in his- 
tory. 

Sunday, April 29, 1894, the Commonweal, under the 
personal command of J. S. Coxey, reached the District 
of Columbia, going into camp at Brightwood park. In 
addition to this contingent, sixteen other separate divi- 
sions were en route to Washington City from California, 



THE COXEY PLAN 



47 



Colorado, Washington, Wisconsin, Illinois, Iowa, Okla- 
homa, Indiana, Pennsylvania, Massachusetts, New Jersey 
and other states. The barriers they encountered, hard- 
ships they endured and the incidents of the marches have 
become matters of history. 

On arrival at Washington, Mr. Coxey called upon the 
Vice-President and Speaker of the House and requested 
permission to hold a meeting on the Capitol steps, which 
request — while not granted, was not denied. 




ON TO WASHINGTON, 1894 

Marshal Carl Browne at the head of 
Coxey's Army 



Promptly on time, May 1, at 12 M., the Commonweal 
reached the Capitol, being greeted on the line of march 
*and at the Capitol by the largest concourse of people 
ever assembled there. Police interference prevented the 
army from reaching the Capitol steps, but by a strategic 
movement Mr. Coxey reached the steps only to be con- 
fronted by a lieutenant of police who forbade him to 
speak from the Capitol steps. 



48 



THE COXEY PLAN 




COXEY'S ARMY ENTERING PENNSYLVANIA 
AVENUE FROM 14th STREET, WASH- 
INGTON, MAY 1, 1894 



COXEY AT THE CAPITOL 

The Speech He Had Intended to Deliver at the Door 

of Congress 

Washington, D. C, May 1, 1894.— The following is 
what Coxey intended to say today: 

"The Constitution of the United States guarantees 
to all citizens the right to peacefully assemble and peti- 
tion for a redress of grievances, and furthermore de- 
clares that the right of free speech shall not be abridged. 
We stand here today to test these guarantees of our con- 
stitution. We choose this place of assemblage because it 
is the property of the people and if it be the right of the 
people to peacefully assemble on their own premises and 
if this privilege has been abridged by the passage of 
laws in direct violation of the constitution, we are here 
to draw the eyes of the entire nation to this shameful 



. THE COXEY PLAN 49 

fact. Here, rather than any other spot upon the con- 
tinent, it is fitting that we should come to mourn over 
our dead liberties, and by our protest arouse the im- 
periled nation to such action as shall rescue the Consti- 
tution and resurrect our liberty. Upon these steps where 
we stand has been spread a carpet for the royal feet of a 
foreign princess, the cost of whose lavish entertainment 
was taken from the public treasury without the consent 
or approval of the people. Up these steps the lobby- 
ists of trusts and corporations have passed unchallenged 
on their way to committee-rooms to which we, the repre- 
sentatives of the producers, have been denied. 

"We stand here today in behalf of millions of toil- 
ers whose petitions have been unresponded to, and whose 
opportunities for honest, remunerative, productive labor 
have been taken from them by unjust legislation protect- 
ing idleness, speculators and gamblers. For a quarter of a 
century the rich have been growing richer and the poor 
poorer, and by the close of the present century the middle 
class will have disappeared as the struggle for existence 
becomes fierce and relentless. We stand here to remind 
congress of its promise of returning prosperity should 
the Sherman act be repealed. We stand here to declare 
by our march of over 500 miles through difficulties, a 
march unstained by even the slightest act that would 
bring the blush of shame to any, that we are law-abiding 
citizens, and as such our actions speak louder than words. 
We are here to petition for legislation which will furnish 
employment for every man able and w r illing to w r ork, legis- 
lation which will bring universal prosperity, emancipate 
our beloved country from financial bondage to the de- 
scendants of King George. We have come to the only 
source which is competent to aid the people in their day 
of distress. We are here to tell our representatives, who 
hold their seats by grace of our "ballots, that the struggle 
for existence has become far too fierce and relentless. 
We come and throw up our defenseless hands and say: 
'Help, or we and our loved ones must perish.' 

"We are engaged in a bitter and cruel war with the 
enemies of all mankind — a war with hunger, wretched- 
ness and despair, and we ask Congress to heed our peti- 
tions and issue for the nation's good a sufficient volume 
of the same kind of money which carried the country 
through one awful war and saved the life of the nation. 
In the name of justice, through whose impartial admiriis- 



50 



THE COXEY PLAN 




THE COXEY PLAN 51 

tration only the present civilization can be maintained 
and perpetuated, by the powers of the Constitution of 
our country upon which the liberties of the people must 
depend, all in the name of the Commonweal of Christ, 
whose representatives we are, we enter a most solemn 
and earnest protest against the unnecessary and cruel act 
of usurpation and tyranny and this enforced subjugation 
of the rights and privileges of American citizenship. We 
have assembled here in violation of no just laws, to enjoy 
the privileges of every American citizen. 

"We are now under the shadow of the capitol of 
this great nation and in the presence of our national 
legislature are refused that dearly bought privilege, and 
by the force of arbitrary power prevented from carrying 
out the desire of our hearts, which is plainly granted 
under the great Magna Charta of our national liberty. 
We have come here through toil and weary march, 
through storms and tempests, over mountains and amid 
the trials of poverty and distress at the doors of Con- 
gress in the name of Him whose banners w^bear, in the 
name of Him who pleaded for the poor and the op- 
pressed, that they should heed the voice of distress and 
despair at this now coming up from every section of our 
country, that they should consider the conditions of the 
unemployed of our land and enact such laws as will give 
them employment, bring happier conditions to the people 
and the smile of contentment. to our citizens. 

"Coming as we do with peace and good will to men, 
we shall submit to these laws, unjust as they are, and 
obey this mandate of authority of might, whoever over- 
rides and outrages the law of right. We appeal to every 
peace-loving citizen, every liberty-loving man and woman 
in whose breast the fire of patriotism and love of coun- 
try has not died out, to assist us in our efforts towards 
better laws and general benefit. 

J. S. COXEY, Commander of the Commonweal. 

The arrest and imprisonment of Coxey, Jones and 
Browne for twenty days, and fines of five dollars, and the 
imprisonment of the balance of Commonwealers by the 
Governor of Maryland, making a raid upon the camp in 
the night, by fifty heavily armed policemen from Balti- 
more, surprising each of the men and taking them before 
a " Jeffries" justice of the peace in the plot, who shame- 
lessly ordered them confined in the Maryland workhouse 
for no other crime than not having any work to do, the 



52 THECOXEYPLAN 

justice expressing sorrow that Mr. Coxey was not one 
of the number, and showed great chagrin that the young 
man with the blue and gray uniform on was not Jesse 
Coxey, he having eluded the vigilance of the officers. And 
though busy with his campaign in Ohio, Mr. Coxey went 
to the scene of the outrage and employed a lawyer — Mr. 
Ralston — and applied for a habeas corpus and put the' 
governor of Maryland in such a dilemma that he was 
compelled to pardon the men out to save himself from the 
ignominy that would surely have followed his high hand- 
ed proceedings ventilated in a court of record. But by 
some oversight, three Commonwealers were not let out 
until the last week in October and the hardships that they 
underwent has been put in form of affidavits that caused 
the governor of Maryland to abandon the contest for 
re-election. One of these three men is so broken by hard- 
ships endured, that he is only existing on charity. An- 
other one is in his bed in a public hospital in Washing- 
ton, probably never to leave it alive. While the third 
came out stone blind and all this in a land where the 
newspapers are filling their columns with outrages in 
Armenia, Siberia, and Cuba, but fail to see such as this 
under their very noses. 

MONEY 

"The redemption of money in commodities and services 
through the clearing houses of the industry of the world, 
from which every one withdraws precisely the things he 
desires in exchange for the money he holds, is the beau 
ideal money, under the present system of the infinite divi- 
sion of labor." — Moran on Money, 111. 

"When a laborer has received his wages in money he has 
not received an equivalent for his services, but only some- 
thing which will enable him to get what he chooses. The 
money, therefore, that he possesses is not the equivalent, 
but it is the symbol, the proof, that he has rendered ser- 
vices or property, for which he has not received an equi- 
valent." — Macleod on Banking, 1 :24. 



THE COXEY PLAN 53 

Banking and Currency Hearings 

Before the 
Coxiunittee on Banking and Currency, United States 

Senate 

SIXTY-THIRD CONGRESS 

FIRST SESSION 
ON 

S. 2639 

A BILL TO PROVIDE FOR THE ESTABLISHMENT OF FEDERAL 
RESERVE BANKS, FOR FURNISHING AN ELASTIC CUR- 
RENCY, AFFORDING MEANS OF REDISCOUNTING COM- 
MERCIAL PAPER, AND TO ESTABLISH A MORE 
EFFECTIVE SUPERVISION OF BANKING 
IN THE UNITED STATES, AND FOR 
OTHER PURPOSES 

Part 37 

[Printed for the use of the Committee on Banking and Currency] 

WASHINGTON 

GOVERNMENT PRINTING OFFICE 

1913 

COMMITTEE ON BANKING AND CURRENCY. 
United States Senate. 
Robert L. Owen, Oklahoma, Chairman. 
Gilbert M. Hitchcock, Nebraska. Knute Nelson, Minnesota. 
James A. O'Gorman, New York. Joseph L. Bristow, Kansas. 
James A. Reed, Missouri. Coe I. Crawford, South Dakota. 

Atlee' Pomerene, Ohio. George P. McLean, Connecticut. 

John F. Shafroth, Colorado. John W. Weeks, Massachusetts. 
Henry F. Hollis, New Hampshire. 

James W. Beller, Clerk. 

Oct. 23rd, 1913. 



STATEMENT OF JACOB S. COXEY, OF MASSILLON, O. 

Senator O'Gorman. Mr. Coxey, will you state your 
name, your residence, and your business activity? 

Mr. Coxey. My name is Jacob S. Coxey. 

Senator O'Gorman. And what is your residence, Mr. 
Coxey? 



54 THECOXEYPLAN 

Mr. Coxey. Massillon, Ohio. 

Senator O'Gorman. And your business activity? 

Mr. Coxey. I am in the stone-quarry business. 

Senator O'Gorman. Have you read the pending bill? 

Mr. Coxey. I have, sir. 

Senator O'Gorman. Kindly state to the committee 
your views in regard to it. 

Mr. Coxey. As I view this bill, I take it, you are 
trying to arrange a currency system that will transact 
the commerce of this country. But I think you should 
take into consideration the burden under the present 
system and under the proposed system that will be placed 
upon the producers of this country in obtaining the funds 
to exchange their products. 

There are three Government functions, and this, the 
means of exchange, is the greatest of the three, that are 
necessary for the exchange of the commerce of the coun- 
try. The first one is the means of communication. This 
one the Government has retained; that is, the postal sys- 
tem, and is operating that system at cost to the people. 
They engrave and print the postage stamps and furnish 
them at cost to the people. John D. Rockefeller, with all 
his corporations, if he needs 10,000 postage stamps for 
the use of those corporations has no advantage over the 
man who is tearing that brick building down over across 
the street when he needs only 1 postage stamp. 

That the postal is a Government function, and that 
is being furnished at cost to the people, and when I say 
the stamps are being furnished at cost to the people the 
stamp simply represents the cost of the transmission of 
the mail that it is put upon. After it has done that it is 
cancelled and has performed its functions. 

Now, when we come to the second one, the means of 
exchange, you have granted franchises to private cor- 
porations. You have been creating, and do propose to 
create, under this bill the money at cost to these corpora- 
tions, and then when even you, the creator, the Federal 
Government, needed or will need any of this money, as, 
for instance, you needed it in the building of the Panama 
Canal, you issued several hundred millions of dollars of 
interest-bearing bonds that were nontaxable, sold them 
to the banks, and the Government borrowed from the 
banks its own money and is now paying interest for the 
use of its own money. This system seems to me to be 
absurd. 



THECOXEYPLAN 55 

When we come to the producers of the country, let 
us examine their burden. Last year President Taft called 
the governors of the various States together and he 
stated to the governors the necessity of establishing State 
banking institutions in order to lessen the burden that 
was placed upon the American farmer. He said to the 
governors that there were 12,000,000 American farmers, 
and that they were producing annually $9,000,000,000 of 
products upon a borrowed capital of $6,040,000,000, for 
which they were paying in interest and commissions in 
order to obtain that money 8V2 P^ r cent. This makes a 
total burden of $513,000,000 annually, taken from the 
statement of Mr. Taft, which burden is placed upon the 
tiller of the soil, who produces the products we are con- 
suming in this country. 

Senator Weeks. Do you think those figures as you 
have given them to us are accurate as to the rate of in- 
terest ? 

Mr. Coxey. Yes, sir; the average rate of interest is 

8V2 P er cen t. 

Senator Weeks. I have heard those figures, and I do 
not know a single State, even in the South, where that 
rate was charged. 

Mr. Coxey. There are Senators here from Western 
States where rates as high as that are charged, and I 
think they will bear me out in that statement. 

Senator Reed. The average rate in my State of 
Missouri is about 5V2 P^ r cent. 

Senator Bristow. It runs from 6 to 7 per cent, in my 
State of Kansas. 

Senator Shafroth. In mining sections of my State 
of Colorado it runs as high as 1 per cent, a month. 

Mr. Coxey. In the State of Ohio it is from 6 to 8 
per cent; 8 per cent, is the average. 

Senator O'Gorman. What changes would you pro- 
pose in the pending bill? 

Mr. Coxey. I want to show you first where the 
burden lies under the present system and will not be 
lightened under the pending bill. President Taft called 
attention to the burden upon the tiller of the soil of 
$513,000,000 annually. I see from the bank statements 
that the other producers outside of the farmers are pay- 
ing for the use of that money and bankers' credit which 
the Government is creating at cost to the banking insti- 
tutions, besides legalizing 85 per cent, of the banks' 



56 ■ THECOXEYPLAN 

credit, which they, the bankers, are levying a toll upon 
to exchange the products, because the bank credits are 
exchanging the products from the producer to the con- 
sumer, exactly the same as the real money. I find from 
the bank statements that there are about $17,000,000,000 
of deposits and $13,500,000,000 of loans out of those 
deposits, and one billion and a half of real money in the 
banks as a foundation for those loans. That is nine of 
bankers' legalized credit to one of real money. Now, an 
average of 6 per cent, upon that $13,500,000,000 is near- 
ly $800,000,000 annually for the use of those banks' cred- 
its and money to exchange the products from the pro- 
ducer to the consumer. 

Now, the banks, in order to inflate their credits 
higher do as one bank president from Columbus, Ohio, 
told me last spring, that he wanted to use his bank re- 
serves and he went to New York — he told me this in New 
York at the Waldorf-Astoria Hotel — he said, "Our daily 
balance of legal reserves in New York amounts to about 
$100,000," and he went to four different banking insti- 
tutions and tried to get it through their noddle — that is 
the expression he used — that they would make more 
money by carrying out his plan, and his bank would 
make more money if they would make a loan to his 
bank of $100,000, upon which they would pay 4 per cent., 
and the New York bank agreeing to make the loan, but 
the proceeds of that loan should be held there with the 
New York bank as their, the Columbus bank's, legal re- 
serve, and then that the New York bank should pay them 
2 per cent, upon their daily balance. That would be mak- 
ing a profit to the New York bank of 2 per cent, and 
make it cost the Columbus bank 2 per cent., and it would 
allow the New York bank to loan out 75 per cent, of that, 
loan to their customers there at the market rates and 
then redeposit 9 per cent, of the reserves of the 25 per 
cent, in the reserve bank, they to receive 2 per cent, on 
this reserve. That allowed the Columbus bank to with- 
draw the $100,000 of their cash reserves from New York, 
which the Columbus bank did loan at Columbus at 6 
per cent. The Columbus banker got that through, and 
that is the way he is doing today, utilizing his reserves 
and extending his bank credits in that manner. 

Now, the question comes as to the remedy I will 
suggest here. You must arrange under this bill to not 
only furnish the money necessary for the exchange of 



THE COXEY PLAN 57 



the products and the commerce of this country, but to 
furnish the money for all public improvements and for 
the building and equipping of our railroads. It will take 
over a billion of dollars annually for the equipment of 
our railroads. 

Under the present system those railroads must issue 
bonds bearing interest and sell those bonds to the banks 
in order to borrow this money. Under the present sys- 
tem we must do the same so far as public improvements 
are concerned. Take, for instance, the public highways. 
At a road convention last fall, at Atlantic City, I spoke 
upon that question, and I said the most important thing 
is the financing of the highways; and that Atlantic City 
road congress was inclined to ask the Government for 
Federal aid. I said it is not Federal aid we need, but 
it is a Federal duty. When this Government imposes a 
tax of 10 per cent, on State issues of currency, it pro- 
hibits its different subdivisions — the States, cities, coun- 
ties, and townships — from issuing a currency in order 
to relieve any stringency and to make any public im- 
provements. When they do that, then it is the duty of 
the Federal Government to furnish this money at cost 
for all public improvements by allowing the States to 
issue their non-interest-bearing bonds to run for 25 
years, and then deposit these bonds with the Secretary 
of the Treasury, when it shall be mandatory upon the 
Secretary of the Treasury to issue the face value of the 
bonds in full legal-tender money. 

Senator Nelson. Notes of the Government? 

Mr. Coxey. Real money. I contend that the only 
real money is the fiat of the Government. Money is 
simply an idea of Congress enacted into law. It is a 
representative of value, and should never have a value 
of or in itself. And as it passes from the Government 
under this system, if these bonds were deposited with the 
Government and .the face value of them would be issued 
in full legal-tender money, the cost of the engraving anc^ 
distributing of this money would be charged against this 
issue, and that would not exceed over 1 per cent. Ninety- 
nine per cent, would be forwarded to its subdivisions, 
which they would have to use for the purpose of making 
public improvements. 

Now, under this plan you have the State, county, 
township, or municipal noninterest bonds deposited as 
security for this issue of legal-tender money. Then they 



58 ' THECOXEYPLAN 

start the people to work to make improvements, and as 
the service is rendered or the material is furnished this 
money is turned out, and it then represents that service 
or that material and that value created. 

As to the redemption or repayment of this money, 
levy a tax as you do now, and instead of paying 4 per 
cent, interest return 4 per cent, annually to the Govern- 
ment, and as it is returned and retired annually it can 
be canceled. It has performed its function, and in 25 
years you will have paid off the noninterest-bearing debt 
of all the subdivisions of this General Government and 
there is no bonded debt left at all, as the money has been 
furnished at cost, the same as postage stamps are now. 

Senator Reed. Suppose the people do not take that 
money ? 

Mr. Coxey. They would be very glad to take it when 
it is made legal tender for debt. There should be no 
money issued that would not be a full legal tender for 
all debts. 

Senator O'Gorman. You may proceed, Mr. Coxey. 
You were speaking of the city of New York, and I was 
somewhat interested in that. 

Mr. Coxey. The city of New York has a bonded 
indebtedness of about 1,100 millions of dollars. They are 
not paying off the principal; they are simply levying a 
tax rate in order to pay the interest, and they are pyra- 
miding the principal. 

There was an issue within the last year in regard 
to the building of the subway. They needed $200,000,- 
000 to do that. They should have passed this law, and 
if this law were put into effect the city of New York 
could have issued its noninterest-bearing bonds for $200,- 
000,000, running for 25 years, and could have forwarded 
those bonds to Washington and have had the face value 
of those bonds issued in full legal-tender money, deduct- 
ing 1 per cent to pay for the engraving and printing and 
distributing by the Government. They would have had 
$198,000,000 to pay for all these subways, and then out of 
the revenues of the subways they could return to the 
Government annually $8,000,000, and in 25 years the 
entire bonded indebtedness would be paid off. Now, then, 
they propose issuing, and are now issuing, $200,000,000 
of 5 per cent, bonds, which they will sell or have sold 
to the banking syndicate, and they will pay interest for 
50 years and still owe the principal. 



THECOXEYPLAN 59 

I claim that this is a correct principle, Mr. Chair- 
man. It is the duty of the Government, I contend, this 
being a Government function, that all money necessary 
for all public improvements and utilities should be fur- 
nished at cost to the people, the same as the postage 
stamps are now. 

Now, I have illustrated to you the plan of public 
improvements. When it comes to the plan of furnishing 
the money at cost to the producers to exchange their 
products there should be a Government bank established 
in every municipality of over 1,000 population. In towns 
under 1,000 and over 500 population this money should 
be handled through the postoffice. These banking in- 
stitutions — take, for instance, in the town where I live. 
We have Ave banking institutions. The economical way 
of handling that would be to have one Government bank, 
with a sufficient volume of money on hand there for the 
needs of the community. It should be the same in every 
municipality of over 1,000 population. That money should 
be furnished to the people at a tax of 2 per cent. It will 
cost one-half of 1 per cent, to pay for the operating ex- 
penses of the bank, the furnishing of the money, insuring 
the property pledged, and all necessary expenses. That 
deducted from the 2 per cent, will leave a net revenue 
to the Government of IV2 Per cent. That means for the 
total amount of money loaned by the Government a 
total revenue to the Government, after deducting ex- 
penses of operation, of $15,000,000 upon every billion 
dollars of loans. 

You can see from the statement of President Taft 
and from the bank statements that there are about $20,- 
000,000,000 now being loaned by the banking institutions 
to the people in the shape of $9 of bank credits to $1 of 
real money for the exchange of our commerce. If we 
take and gradually substitute this $20,000,000,000 of 
legal-tender money that should be full legal tender for 
all debts and substitute it in place of the same amount of 
bank credits being used now this would establish a bank- 
ing system which would give a revenue of $300,000,000 
annually from this source, besides saving to the producers 
$1,200,000,000 annually in interest charges. 

Senator Shafroth. What security would you have 
for the obtaining of money under those circumstances? 

Mr. Coxey. The same that the banks now take. I 
will illustrate with my own business. I quarry stone and 



60 THECOXEYPLAN 

grind it into sand. I supply some of the principal steel 
works of the country, and have been supplying the steel 
works of the country for 32 years. When I ship out a 
carload of sand today we get the railroad weight tomor- 
row, and we make an invoice against the party to whom 
we have shipped the sand. We attach a draft and bill 
of lading to the invoice, take it into the bank, and the 
banker takes his rake-off of 8 per cent, and credits me 
with the balance. I make that draft due and payable 
on the 20th of the month following the month of ship- 
ment. If it is shipped today, that account will be due 
on the 20th of next month, and I make that draft for 
that number of days and they discount it and place the 
balance, after deducting the discount, to my credit. 

When they remit for this — they may remit direct 
to the bank or they may remit to me, but in every case 
that remittance is taken in and the draft taken out. If 
it is not paid on the day that it is due, it runs on and 
the interest is charged to me. That is one system. 

Under that system the banks are furnishing the 
means to exchange the products; they are furnishing in 
this case the working capital — the money with which 
to do business — because we have first the money for the 
investment in the enterprise which is necessary. In a 
case of this kind the bank furnishes the working capital, 
but they get their interest in Ohio of 8 per cent, for do- 
ing it. That is one means. 

Another means would be for the people to bring in 
their tax duplicate or tax receipt and loan direct to all 
people upon their taxable real and chattel property. 

This Government fixes a value upon your property 
and levies a tax upon that property, and compels you to 
pay it, and therefore the Government ought to be com- 
pelled to furnish you the money at cost upon it in case 
you needed it for the exchange of your commerce. 

Take, for instance, the farmer in the West. There 
comes a time when he wants to turn his corn into beef 
or turn his corn into pork, and he can go into the bank 
and put up his tax receipts to the bank and borrow 
enough money to purchase the cattle or the hogs to turn 
that corn into beef or into pork, and then as he ships it 
out he can cancel his obligation to the bank. 

Senator Nelson. Mr. Chairman, I would like to sug- 
gest that we are running pretty late. It is now 10 min- 
utes of 6. 



THECOXEYPLAN 61 

Senator O'Gorman. How much longer will you be 
likely to take? 

Mr. Coxey. If there are no questions from the com- 
mittee, there is nothing further that I desire to say. 

Senator Nelson. Now, what have you to say about 
this bill? 

Mr. Coxey. I think it should be made to take into 
consideration and lessen the burdens of the borrower. 
You do not propose to readjust the interest rate in this 
bill at all. Here is an interest rate of at least 6V2 per 
cent all over the country. 

Senator Nelson. Do you approve this bill? 

Mr. Coxey. No, sir. 

Senator Nelson. What are its radical defects? 

Mr. Coxey. In the first place, I do not believe that 
any money should be issued unless it is made a full legal 
tender for all debts, and issued direct by the Federal 
Government. 

Senator Nelson. What next? 

Mr. Coxey. And that it should be taken out of the 
control of the bankers, who control the commerce of this 
country. 

There is a little item that I have in my vest pocket 
here that I cut out of the New York Times last Sunday, 
which shows that there is very little car buying. Now, 
the average man reading that probably would not see 
much in it. It shows what the railroads purchased last 
year in cars. They purchased last year 235,000 cars. 
This year they have purchased for the first nine months 
only 88,000, a falling off of over 60 per cent. 

Senator O'Gorman. Why is that? 

Mr. Coxey. I have an idea what it is. I can give 
you 'my own reason for it. 

Senator O'Gorman. Of course that is all we want. 

Mr. Coxey. The gamblers in New York had gotten 
last year's stocks up to a high point, and then they com- 
menced to unload, and they have sold and sold and sold 
them out at the high prices. Now, then, they are com- 
mencing to break the market, and my contention is that 
the people that control the money volume also control the 
transportation of this land and control its commerce in 
the palm of their hand. They can make times good or 
they can make times bad, because they have the interlock- 
ing system of directors in all the railroads and banking 
institutions, so that they can order the railroads to buy 



62 THECOXEYPLAN 

cars and other equipment, and this makes times good, or 
they can order those railroads to stop buying, and when 
they stop buying it simply stagnates the great manufac- 
turing plants of the country. They cut off the orders 
from the steel plants, and that throws hundreds of thou- 
sands of people out of employment. My business in the 
last four months has been cut in two. It is only 50 per 
cent of what it was last year at the same time, and simply 
from this fact. Now, the railroads of the country need 
the cars, but the railroad directors and the money inter- 
ests have ordered the railroads to stop placing further 
contracts for material, and in doing that it* is bringing on 
a stagnation of business all over the country, and there 
will be hundreds of thousands of people out of work just 
through that fact. Now, that should not be allowed to 
go on, and therefore, while it is not germane to this bill, 
yet I am of the opinion that we should own, operate, and 
control the railroads. 

Senator O'Gorman. The same as we ought to own 
and control the banks? 

Mr. Coxey. Yes, sir. 

Senator Nelson. You think the Government should 
control all banks? 

Mr. Coxey. Yes. 

Senator Nelson. You think all banks should be con- 
trolled and run by the Government? 

Mr. Coxey. Yes. 

Senator Nelson. Wouldn't that make a pretty big 
army of officeholders? 

Mr. Coxey. I am not afraid of an army of office- 
holders. We have a pretty large army now. They have 
never scared me any. 

Senator Nelson. Now, what other defects are there 
in the bill here? 

Mr. Coxey. The main defects are simply these: That 
you are not going to reduce, the interest rate. That is 
the principal thing. It is the burden that is placed upon 
the producer's back that' should be lightened, and this 
will not lighten it. 

Senator Nelson. Would you have, these notes redeem- 
able in gold? 

Mr. Coxey. No, sir. 

Senator Nelson. What would you have them redeem- 
able in? 



THECOXEYPLAN 63 

Mr. Coxey. I would have them redeemable in the 
products of labor and through taxation. 

Senator Nelson. What would be the basis of issue 
for these notes? 

Mr. Coxey. The basis of issue of these notes should 
be legal-tender money issued, based upon State, county, 
township, and municipal bonds, and for the commerce of 
the country the notes would be issued upon the collateral 
that the people would put up. 

Senator McLean. What would the total reach? 

Mr. Coxey. Whatever the necessities of the people 
^vould be. 

Senator McLean. You say there are about $20,000,- 
000,000 of obligations out now. 

Mr. Coxey. And my idea is that instead of having 
the bankers do this for us and charging an exorbitant 
toll we should utilize our own credit and get it at cost. 

Senator Nelson. Your scheme is very interesting, 
and I would suggest that you prepare a skeleton bill giv- 
ing us an idea of the legislation that you think ought to 
be enacted and leave it with the committee. I understand 
that you believe the Government should take over all the 
banks ? 

Mr. Coxey. No; I believe that the Government 
should establish banks itself. 

Senator Nelson. You believe that the Government 
should establish its own banks? 

Mr. Coxey. Yes. The first thing the Government 
should do would be to build a bank in every town, the 
same as the post office, and they should issue to pay for 
them legal-tender money. I told President Roosevelt- 
Senator Nelson (interposing). You would not have 
that- money redeemable at all ? 

Mr. Coxey. Only through taxation, as it comes in 
through the revenues of the Government. 

Senator Nelson. You would not issue Government 
bonds then? 

Mr. Coxey. No; no bonds at all. There never should 
have been a single interest-bearing bond issued by the 
Government. 

Senator Nelson. Well, now, your scheme is very in- 
teresting, and I wish you would prepare a skeleton bill and 
file it with the committee. That is what other gentlemen 
have done who have come here with plans of their own, 
and we can judge of it better when you put it into con- 
crete form. You are a man of a good deal of business 



64 THE COXEY PLAN 

experience and I can see that you look at it from the 
standpoint pf the borrower. 

Mr. Coxey. Yes; I belong to that side. I have been 
paying 8 per cent interest for the last 35 years. 

Senator Nelson. Then you are the class of man that 
we want to hear from, rather than the bankers. 

Mr. Coxey. Senator, that is the position that I took 
when I tried to get a hearing here. 

Senator Norris, of Nebraska, requests that I state 
how goods purchased in foreign countries would be paid 
for in case the Government issue full legal-tender money 
under my proposed plan. 

Just the same as goods are paid for under the pres- 
ent system, viz., if goods are bought abroad and shipped 
to this country, usually they have drafts attached to 
invoice and bill of lading, which is sent through some 
bank to the purchaser, who then pays the draft either 
by his check or cash. This releases the bill of lading and 
he obtains the goods. The bank then remits to the for- 
eign banker that which he, the foreign banker, desires. 
It may be foreign exchange or it may be gold or silver 
bullion or other American products or securities. Money 
between countries has no particular significance. It can 
only go to the United States line. If the banker desires 
gold or any other product, it must be purchased at the 
market price, just the same as if you want a draft to pay 
£100 in London. 

That which most concerns us is to arrange a system 
to exchange our own products at cost and we will have to 
settle foreign trade balances as we have been doing for 
the last 50 years, with commodities such as gold, silver, 
steel, cotton, and other American products and securities. 

Senator Nelson. I think, Mr. Chairman, if he will 
file with us a skeleton form of his bill we can then go 
over it. 

Senator Shafroth. And put in any suggestions that 
you want to make. 

Senator O'Gorman. Without objection, that will be 
done. We will now adjourn until 10:30 tomorrow morn- 
ing. 

(The witness furnished the following for insertion 
in the record in response to the above request:) 

Mr. Chairman and Gentlemen of the 
Committee: A* request was made of me by Mr. 



THECOXEYPLAN 65 

Nelson and the chairman that I incorporate my 
ideas in a skeleton bill, which you will find at- 
tached. The first one is to furnish a money me- 
dium to all of the people at cost through a sys- 
tem of Federal banks established in all munici- 
palities, towns, and villages over 1,000 popula- 
tion and through post offices under 1,000 and 
over 500 population ; these loans to be made upon 
their real and chattel property, evidenced by the 
tax receipt and duplicates in the various local- 
ities to the amount of the assessed value thereon ; 
also on cattle, hogs, sheep, horses, all farm prod- 
ucts, and lumber, ore, minerals, coal, stone, sand, 
and all raw materials of every nature and de- 
scription, as well as all manufactured products 
and plants, the charge or tax for these loans to 
be at the rate of 2 per cent per annum, payable 
semi-annually. In case of long time, 25-year 
loans, which should be made so as to enable the 
farms to be occupied and tilled and the workers 
in our cities to obtain homes and an opportunity 
given the farmers and workers to live decently 
and pay for their farms and homes, and allow 
the enterprising citizens of the United States an 
opportunity to develop the resources of this 
country, therefore the rate of return of the prin- 
cipal of such loans should be no less than 4 per 
cent per annum, the principal, in whole or in . 
part, to be payable on or before 25 years. Such 
reasonable safeguards should be taken by the 
Government officials granting such loans as to in- 
sure the return of the principal of such loans as 
well as the tax of 2 per cent upon the same. The 
amount to be loaned upon the raw and unfin- . 
ished material should be determined by the 
amount of the actual cost in labor and material 
expended upon the same, and upon the finished 
products, if in transit, the invoice value thereof. 
In case of wheat, cotton, corn, and other farm 
products and all finished and raw products in 
warehouses loans should be made to the face mar- 
ket value thereof. 

The second one is to provide for public im- 
provements and employment of the citizens of the 
United States, to encourage industry and produce 
prosperity, and to procure money to purchase and 



66 THECOXEYPLAN 

pay for public utilities, and for the redemption 
of such money. 

Be it enacted by the Senate and House of 
Representatives of the United States of America 
in Congress assembled, That whenever any State, 
Territory, county, township, municipality, or in- 
corporated town or village deeming it necessary 
to make any public improvements, buy or build 
any public utilities or provide for any public 
needs, and give employment to unemployed citi- 
zens of the United States, they shall deposit with 
the Secretary of the Treasury of the United 
States a non-interest-bearing 25-year bond not 
to exceed one-half of the assessed valuation 
of the taxable real estate, exclusive of all im- 
provements thereon, less all outstanding and ex- 
isting indebtedness in said State, Territory, 
county, township, municipality, or incorporated 
town or village, and said bond or bonds to be re- 
tired at the rate of 4 per cent per annum. 
Sec. 2. That whenever the foregoing section of 
this act shall have been complied with it shall be 
mandatory upon the Secretary of the Treasury 
of the United States to have en craved and printed 
Treasury notes in the denominations of $1, $2, 
$5, $10, and $50 each, which shall be a full legal 
tender for all debts, public and private, to the full 
. value of said bond, and deliver to said State, Ter- 
ritory, county, township, municipality, or incor- 
porated town or village 99 per cent of said notes 
and retain 1 per cent for the expense of engrav- 
ing, printing, bookkeeping, disbursing, and taking 
care of this department. 

Sec. 3. That on and after the passage of 
this act every State, Territory, county, township, 
municipality, or incorporated town or village may 
deposit their non-interest-bearing bonds in com- 
pliance with this act in order to give employment 
to any idle man or woman applying for work, 
and the rate shall be not less than $1.50 per day 
for common labor, and not less than $3.50 per 
day for team and labor, and that eight hours per 
day shall constitute a day's labor unde: the pro- 
visions of this act, the same rate to be paid to 
both men and women. 

Sec. 4. That any State, Territory, county. 



THECOXEYPLAN 67 

township, municipality, incorporated town or vil- 
lage issuing non-interest-bearing bonds under the 
provisions of this act shall levy and collect an 
annual tax on all taxable real estate, exclusive of 
all improvements thereon, of the State, Territory, 
county, township, municipality, incorporated town 
or village depositing non-interest-bearing bonds 
sufficient to pay into the United States Treasury 
each year not less than 4 per cent of the total 
amount received from the United States Treasury 
until the whole amount shall have been paid, and 
that whenever these Treasury notes are returned 
to the Secretary of the Treasury at the annual 
payments of 4 per cent they shall be retired, can- 
celled, destroyed, and not again reissued. In case 
either gold, silver, or any other lawful money 
shall or may be sent in lieu of the Treasury notes 
issued on any non-interest-bearing bond deposited 
under the provisions of this act the Secretary of 
the Treasury shall hold or retain such lawful 
money aforementioned until the Treasury notes 
issued on non-interest-bearing bonds deposited by 
State, Territory, county, township, municipality, 
or incorporated town or village shall come in or 
be presented through the regular channels of busi- 
ness with the Secretary of the Treasury when he 
shall release the lawful money so held and retire, 
cancel, and destroy as hereinbefore mentioned. 
Sec. 5. That this act shall be in full force 
and effect from and after its passage and all acts 
and parts of acts in conflict herewith be and they 
are hereby repealed. 

(Whereupon, at 5:55 P. M., the committee adjourned 
to meet at 10:30 o'clock A. M. Friday, October 24, 1913.) 

GOOD MARKET ROADS AT COST 

State Plans for Good Roads by General Jacob S. Coxey 
Questions are Answered 

Subject That Interests Every Citizen of Ohio Discussed 
From Both Sides of the Question — I. and R. Invoked 
For the Cause of Good Roads and Petitions Being 
Circulated. 
General Jacob S. Coxey, the dean of good roads agita- 



68 THECOXEYPLAN 

tion since his memorable march to Washington in 1894, 
is again in the field with a state plan for road improve- 
ment, for which his friends are now circulating petitions 
all over the state for signatures under the I. and R. for an 
amendment to the state constitution. The general says, 
The people, having turned down the $50,000,000 
amendment last September, leaves the field open for the 
next best plan, and in this, one of General Coxey's, he 
makes the bold claim that the day for the old system of 
interest bearing bonds for public works has gone by never 
to return, and in its place he submits the next best, in his 
judgment. 

Will Not Vote for Old Style Bonds Any More 

First. — The Socialists and the farmers voted against the 4% 
per cent interest clause, claiming they would pay in interest fifty 
millions, making a total of one hundred millions paid in taxes for 
fifty millions of roads. 

Answer: This amendment proposed above overcomes 
this objection by making the bonds in denominations of 
$1, $2, $5, $10, $20, $50 and $100 each, interest one-half 
of 1 per cent, per annum, to be paid direct to labor for 
value created and without the aid of banks; non-taxable; 
receivable for all taxes and bills incurred and payable with- 
in the state; to be held as legal reserves in state banks in 
Ohio instead of 4^4 P er cent, interest bonds. The burden 
of the payment of both the principal and the interest on 
these bonds is no greater than a 4V£ per cent, interest per 
annum bond is now, but at the end of twenty-five years 
under the present system you still owe the $100,000,000. 

The People Struck at Graft 

Second Question. — Judging from the amount of graft recently 
exposed, they voted against it, believing only the half of it would go 
into roads, the other half into the grafters' pockets, thus getting only 
twenty-five millions' worth of roads for an outlay of $100,000,000. 

Second Answer: This overcomes the graft by allow- 
ing the legislature of Ohio to enact a law for the state to 
construct bridge, structural, sewer pipe, brick, stone, 
gravel, sand and cement plants, employ its convict labor 
to produce sewer pipe, brick, stone, gravel, sand and ce- 
ment at cost, for state, intercounty, township and village 
market roads, and for all the state, counties, townships, 
municipalities, towns and villages, for their public build- 
ings, sewer systems, paving streets and other public im- 
provements, employing and paying its convicts the same 
rate of wages that is paid for similar labor, deducting for 



THE COXEY PLAN 69 

the maintenance of the convict, the balance to go to his 
family, to be held in trust by the state and turned over 
to him at the expiration of his term, giving him another 
chance with something to start with ; also doing away with 
graft and contract labor. This system will bring the state 
into competition with the bridge, structural, sewer pipe, 
brick, stone, gravel, sand and cement companies if they 
are asking too high a price for their products. 

Not Confined to Intercounty Roads 

Third Question. — Many felt that the fifty million of bonds being 
for an intercounty system of roads, the township and village roads 
would not be benefited thereby and that it was simply for the benefit 
of those living in the city, owning automobiles, wanting to get from 
the cities to the various county seats. 

Third Answer: This amendment overcomes such ob- 
jection, because it contemplates, after constructing all of 
the 8,000 miles of the intercounty market roads, that we 
will . then construct 17,000 miles of township and village 
market roads, so that the farmers will be able to get their 
products to market at all seasons of the year, thereby re- 
ducing the cost of transporting them and maintaining a 
more uniform price of the same the year around. January, 
February, March and April of each year there are plenty 
of eggs, hay, corn and products on the farm but the roads 
are not market roads during, that season, therefore prod- 
ucts cannot be marketed. 

It will keep the young men and women on the farm, 
because the farm will be accessible the year around. It 
will have the effect of taking them out of the cities now 
overcrowded with labor and putting them on the farms 
and making more farmers, thereby lessening the competi- 
tion in manufacturing labor lines and producing more 
farm products. As it is now, you can't keep the young 
men and women on the farm for the reason that from 
Christmas until April, or about three months in the year, 
the roads are impassable. 

Tax Equitably Distributed 

Fourth Question. — Some who lived in the counties where the 
roads have been improved thought that they did not want to vote 
money to pay for the county roads that were not improved, not real- 
izing that we have only 8,000 miles of roads in the state of Ohio 
that are improved, leaving 81,000 miles unimproved. Besides, the old 
improved roads are wearing away rapidly and must be constructed 
with different materials than formerly to make good market roads on 
account of the new vehicle of commerce, the automobile, being more 
destructive than the wagon and iron tire vehicle. 

Fourth Answer: This amendment overcomes this ob- 



THE COXEY PLAN 



jection by making a tax of 73-100 of a mill upon all of the 
assessed valuation of the property of Ohio, which will be 
a tax levy of 73 cents on each thousand dollars of valua- 
tion, will supply one hundred millions of available capital 
to pave 4,000 miles of road eighteen feet wide yearly for 
seven years and pay the principal and one-half of 1 per 
cent, interest in twenty-five years. The tax levy on a 
farm assessed at $10,000 would be $7.30 per annum for 
twenty-five years, at which time the hundred millions of 
bonds with interest will have been paid. This divides the 
burden of payment of principal and interest on these bonds 
as follows: 

Upon the passage of a law by the legislature to carry 
out the provisions of this amendment there will be levied 
and collected in taxes, the rate being 73-100 of a mill on 
$6,202,132,080, the assessed valuation and tax duplicate 
of the state of Ohio, as follows: 

Real estate in cities and villages $2,544,547,115 41.0% 

Farm lands 1,676,590,965 27.1 

Public utilities 912,862,833 14.7 

Banks 174,693,439 2.8 

Personal Property 891,437,728 14.4 

State tax duplicate 6,202,132,080 100.0 

Average annual tax necessary to be paid by persons owning 

property assessed at $1,000 $0.73 

Thereby raising $4,000,000 each year to be paid in 
redemption of 4 per cent, of said bonds and $500,000 in 
interest in payment of one-half of 1 per cent, per annum. 
Labor gets the benefit of this interest in contrast to pres- 
ent issues of bonds, as said bonds will be paid to con- 
tractor, said contractor paying them direct to labor and 
for material furnished, as said bonds are receivable in 
payment of taxes and contracts incurred and payable with- 
in the state, and will have constructed at end of seventh 
year 25,844 miles of macadam or brick roads and 800 
miles each year thereafter, estimating the cost at $5,000 
per mile. 

Non-Taxpayers 

Fifth Question and Answer. — Many city nontaxpayers felt they 
had no right to vote bonds upon taxpayers, and the question of roads 
did not concern them because they did not use them, forgetting they 
pay their share of the burden of taxes indirectly through rents and 
the products they consume. 

Highway Commission Supervision 

The Ohio state highway commissioner claims that in 
the roads he has contracted out he has found it difficult to 
get the contractors to even read the "specifications" and he 
"must keep an engineer or superintendent on the job all 



THECOXEYPLAN 71 

the time or else it will be slighted." This being the case, 
there should be a state highway commission of three or- 
ganized with an engineering corps, under their super- 
vision, similar to those the great railroad systems main- 
tain, called maintenance of way. This commission should 
have full charge of all bridge, structural, sewer pipe, 
brick, stone, gravel, sand and cement materials for state, 
township and village market roads, and the state, counties, 
inter-county, townships, municipalities, towns and villages ; 
their public buildings, paving streets, sewer systems and 
other public improvements; also have charge of all the 
market roadways of the state, intercounty, townships and 
villages, organized into divisions and sections with the 
section gang similar to railroad section gangs, to maintain 
the roads of the state, intercounty, townships and villages. 

Bonus in Lieu of Graft 

Under this plan the highway commission may, at its 
will, do the work itself or else own the equipment to build, 
as an illustration, say, ten miles of eighteen feet wide 
market roads in a season, and simply contract to one con- 
tractor, giving him the use of the equipment free, also 
furnishing all the material and labor for ten miles at, 
say, 10 per cent, commission on actual cost of material 
and labor, furnished and paid for, in the construction 
of the said ten miles. This 10 per cent, is for the super- 
vision of same by the contractor. In addition to the 
10 per cent commission there should be a bonus of 
25 per cent paid to said supervisor or contractor upon the 
saving of maintenance of the said ten miles of road con- 
structed by him for the first ten years after completion, 
said saving to be based upon the cost of the maintenance 
of similar roads that have been constructed under the 
present graft system for the same length of time after 
their completion. This bonus is in place of graft — a pre- 
mium upon honesty, skilled workmanship and to con- 
struct as perfect a market road as can be built. There 
will be no incentive to slight the roads with inferior 
material and workmanship. The contractor or supervisor 
will have no money invested in equipment, material or 
payrolls, so that his entire energy and thought can be cen- 
tered in constructing the best market roads that can be 
built. The commission under this plan can have 400 con- 
tractors or supervisors at work in the various counties 
of the state at the same time and can construct 4,000 miles 
of good market roads annually. 



72 THE COXEY PLAN 

No Excuse for Inferior Materials 

Under the state system we can have no excuse for 
using an inferior brick for surfacing the road, as the 
manufacturing, inspection and disposal of the brick and 
all materials will be under the supervision of the highway 
commission, and they alone will be responsible. The brick 
culls can be broken up and used in the place of stone in 
the concrete foundations, thus utilizing the inferior 
products. 

Many People Inquire 

"Why make the bonds bearing interest at all? Why 
not make them without interest and save the one-half of 
1 per cent, per annum?" 

For the reason that there is a federal statute placing 
a tax of 10 per cent, upon state issues of currency. By 
making these bonds bear one-half of 1 per cent, interest 
per annum it makes them interest bearing bonds and gets 
around the federal statute of a tax of 10 per cent, on 
state issues of currency. 

Federal Duty Not National Aid 

The following is the proposed federal plan : 
We can work under the state plan until such time as 
we may be able to get a federal statute passed to adopt 
the non-interest bond bill, which provides for the states, 
counties, townships, municipalities, towns and villages to 
deposit their twenty-five-year non-interest bond with the 
secretary of the treasury of the United States; that it 
shall be mandatory upon him to issue the face value of 
the bonds in full legal tender money, deducting 1 per cent, 
to pay for engraving, printing and distributing, the bal- 
ance to be delivered to the state, county, township, muni- 
cipality, town or village that deposits its bonds in accord- 
ance therewith, each being required to levy a tax to re- 
turn the principal at the rate of 4 per cent, per annum, 
when such currency shall be retired and canceled but 
without interest. This is the original plan of federal 
duty (not aid) that Coxey's army marched to Washing- 
ton in 1894 petitioning congress to pass. It is proposed 
in this amendment under the state plan for $100,000,000 
bonds bearing one-half of 1 per cent, interest per annum, 
the least possible rate, to save $4,000,000 in interest per 
annum to start with. 

Additional Economics 

In addition, by doing the work under the highway 
\commission there will be a saving of 10 per cent, over the 



THE COXEY PLAN 73 

old method of letting to contractors and by condemnation 
proceedings and acquiring or constructing up to date 
manufacturing plants so as to supply bridge, structural 
sewer pipe, brick, stone, gravel, sand and cement mate- 
rials at cost, thus saving at least 66 2-3 per cent, on mate- 
rials furnished; also there will be no sales commission, as 
the materials will be manufactured by the state for it and 
its subdivisions' own use without profit and not for pri- 
vate use. 

I am satisfied that under the plan I suggest of the 
state, through its commission, constructing brick and 
other plants, after acquiring shale, coal and mineral lands, 
producing brick and other materials at cost, hiring the 
labor direct, that it can construct a vitrified brick pave- 
ment with a concrete foundation, eighteen feet wide, at a 
cost of 5,000 per mile instead of $15,000 per mile, under 
the present system. 

In Contrast with Present System 

Under the present plan of stock companies the 60% of 
C^rnin^s over cost goes to pay interest on bonded indebt- 
edness, dividends upon watered as well as upon physical 
stock and sales commission, where the graft creeps in. 

Under the state plan there is only one-half of 1 per 
cent, interest on investment, no dividends, insurance nor 
graft. The brick, manufactured by the state, will cost 
$2,112.20 per mile against $6,336.60 per mile for an eight- 
een foot roadway. It will require fifty-six brick plants, 
costing $250,000 each, total, $14,000,000, employing 132 
men each; total, 7,392 men, working 300 days per year, 
to produce 1,689,600,000 brick to build 4,000 miles of 
eighteen foot road per year, for the next twenty years, 
to complete the good market road system of Ohio. 

"This would cost the state by producing the brick 
under this plan $171,088,200 against $513,264,600 under 
the present contract plan, a saving of $342,176,400 on 
brick alone on 81,000 miles of road. 

Last, but not least, by increasing the bond limit to 
$200,000,000 at the end of the sixth year and to $300,- 
000,000 at the end of the twelfth year the taxpayers 
would be saving the 4 per cent, interest per annum upon 
the total expenditures for the 81,000 miles of road, the 
bonds averaging twenty-five years to run, which would 
amount to a saving in interest alone of $371,420,000 by 
the time the bonds are matured and paid. The total sav- 
ing to the taxpayers of Ohio alone in improving the 81,- 
000 miles of unimproved roads will amount to $781,420,- 



74 THECOXEYPLAN 



000, the roads costing under this system, including in- 
terest at one-half of 1 per cent, per annum, $433,580,000, 
besides furnish brick at $5 per thousand instead of $15. 
Bridge and structural materials, sewer pipe, gravel, stone, 
sand and cement to the state, counties, townships, muni- 
cipalities, towns and villages at cost. Whereas if we con- 
tinue under the present system of paying 4 1-2 per cent. 
interest on bonds for twenty-five years and letting out 
our roads to contractors in the end they will cost the tax- 
payers $1,215,000,000 in principal and $371,420,000 in 
interest. 

600 IDLE CONVICTS 

Governor Cox is authority that Ohio has 660 state 
convicts and nothing to employ them. Now figure a 
little, Mr. Taxpayer, two men working three hundred 
days in a year can produce enough brick to pave one mile 
of road, 18 feet wide, therefore, these six hundred idle 
convicts if permitted to work in state owned plants pro- 
ducing brick could furnish the material for paving 300 
miles of highway each year. 

Under humane administration, these men would be 
paid by the state the same wages it would pay other 
labor, then, after deducting the cost of maintaining, feed- 
ing, clothing and housing, the balance be turned over to 
the families of these prisoners, or held in trust by the 
state to be paid at expiration of their term, and thus be 
equipped to start life anew and become useful citizens, 
with a wholesome love and respect for a government 
which had thus made provision for their families and 
themselves. 

At present, it is "unconstitutional" for the Governor 
and the legislature to furnish employment to these men 
in any such manner. If it looks humane to you. and in 
your interest as a tax-payer to have the roads thus im- 
proved, suppose you get one of the Coxey petitions busy 
in your neighborhood to make it "constitutional/' 



THECOXEYPLAN 75 

Coxey Good Market Roads 
At Cost 

Initiative Petition 

Amendment to the Constitution proposed by Initiative 
Petition to be submitted directly to the Electors of the 
State of Ohio amending Section 1 of Article 8. 

BE IT RESOLVED BY THE PEOPLE OF THE 
STATE OF OHIO, That Section 1 of Article 8 be amended 
as follows: 

(Present Constitution.) Section 1. The State 
may contract debts to supply casual deficits or failures 
in revenues, or to meet expenses not otherwise pro- 
vided for; but the aggregate amount of such debts, 
direct and contingent, whether contracted by virtue 
of one or more acts of the General Assembly, or at 
different periods of time, shall never exceed seven 
hundred and fifty thousand dollars; and the money 
arising from the creation of such debts, shall be ap- 
plied to the purpose for which it was obtained, or to 
repay the debts so contracted, and to no other pur- 
pose whatever; (Proposed Amendment to Section 1 
of Article 8) provided, however, that laws may be 
passed to contract debts and authorize issues of 
bonds to an amount which in the aggregate of all is- 
sues outstanding at any one time shall not exceed 
One Hundred Million Dollars, in denominations of $1, 
$2, $5, $10, $20, $50 and $100 each, bearing interest 
not to exceed one-half of one per cent, per annum, 
for the purpose of constructing, rebuilding, improv- 
" ing and repairing a system of State, Inter-County, 
Township and Village wagon roads and bridges 
throughout the State of Ohio, and, if required, to pre- 
pare and supply material for said purposes, or for the 
State, Counties, Townships, Municipalities, Towns 
and Villages for their public improvements, to ac- 
quire, condemn, or construct manufacturing plants, 
and to acquire or condemn lands containing oil, gas, 
stone, clay, shale, marl, sand and minerals, in the 
State of Ohio. 

Said bonds shall be receivable for State, County, 
Township, Municipal and Village taxes; in payment 
of private obligations incurred and payable within 
the State, held as legal reserves of banks organized 



76 THE COXEY PLAN 

under the laws of the State of Ohio, and exempt from 
taxation. 

There shall be levied and collected annually by 
taxation an amount sufficient to pay the interest of 
one-half of one per cent, per annum, and to redeem 
said bonds at the rate of Four Million Dollars per 
annum. Laws shall be passed to provide for the 
maintenance of said roads and bridges. 

Such construction, rebuilding, improving and re- 
pairing of wagon roads and bridges, and the acquir- 
ing, condemnation or construction of manufacturing 
plants, and the acquiring or condemnation of such 
lands, shall be determined under general laws, and 
the cost of construction, rebuilding, improving and 
repairing the same and of such acquiring, condemna- 
tion or construction shall be paid by the State out of 
this fund. 

The provisions of this section shall not be lim- 
ited or controlled by Section 2 and Section 6 of Art. 
12. 

We, the undersigned, petition that the foregoing pro- 
posed amendment be submitted at the general election in 
1914. 

Copy of the above blank petitions will be supplied by 
addressing General Jacob S. Coxey, Massillon, Ohio. 

The state can construct a modern brick plant (con- 
tinuous kiln) with a capacity of 100,000 brick daily, for 
$250,000. 

The plant can produce 30,000,000 brick annually in 
300 work days. This makes it at maximum output and 
minimum cost. Following is the cost of the manufacture 
of brick per 1,000, figuring state to own its coal mines: 
Fuel cost for power, 600 lbs. coal, at $1.30 per ton, 

per 1,000 brick C .' $0.39— $39.00 

Fuel cost for drying and burning, 900 lbs. at $1.30 

per ton, per 1,000 brick $0.58 %— $58.50 

Materials, shale, etc., handled with steam shovels, 
from state owned beds, 11,000 lbs. to 1,000 

brick of 10% lbs. each, per 1,000 brick $0.10— $10.00 

Supplies, incidentals, repairs to machinery, etc., 

per 1,000 $0.25— $25.00 

Depreciation, wear and tear on plant, 10 per cent 

per year on $250,000 $0.83 1/3— $83.33 

Interest, V 2 of 1 per cent on $250,000 bonds, per 

1,000 $0.04 1/10— $4.10 

Labor in producing clay and material, manufactur- 
ing brick, drying, burning, loading in cars, and 
office expense, working total of 132 men per 

1,000 $2.65-100— $265.07 

Superintendent of plant, per 1,000 brick $0.15— $15.00 



THE COXEY PLAN 77 

The cost, if owned and operated by the state, will be 
$5 per 1,000 for vitrified paving blocks, weighing 10 1-2 
lbs. each, against $15 per 1,000, which is now being paid, 
a saving of 68 2-3 per cent, over the nresent system of 
letting the contracts to construct the roads to contractors, 
they buying the material from manufacturers. 

What Our Government Legalizes ^ 

It creates money, furnishes it to the banks AT COST, 
to be loaned to the producer at 6 to 8 per cent. 

Government pays the banks interest upon their non- 
taxable bonds deposited as collateral for the issuance of 
money at cost! 

Government allows BY LAW the banks to loan out 
at interest 88 per cent, of the bankers' debts (their de- 
posits), therefore the bankers live upon the interest they 
receive upon their debts, but the producers must pay the 
interest upon their debts. 

Our Government allows the productive corporations 
to put 20 millions of water into a ten million dollar phys- 
ical value corporation, and thereby capitalize it at 30 
millions, then lowers the price of labor and puts in the 
speeding system so as to pay dividends upon the water as 
well as the physical value. 

Allows the railroads to capitalize their corporations 
to eighteen billions in bonds and stock which only cost 
six billions, and then creates an inter-state commerce com- 
mission to run them and fix the tolls to pay dividends 
upon 18 billions (of which two thirds is water), the Gov- 
ernment paying expenses of regulating the railroads and 
fixing the rates of freight and passenger service, but is 
getting none of the profits! Same way with the tele- 
graphs and telephones ! 

What is the result? The only thing that we have 
saved, is the postal system, which is being operated at 
cost to all the people. 

The banks are pulling out of the people in interest 
more than they can stand for. 

The railroads are draining the people through trans- 
portation rates. 

The productive industries are crowding their labor 
down and speeding them up to the point which compels 
open conflict with fheir employees. 

Starvation faces the worker because he is unable 



78 THECOXEYPLAN 

to speed up fast enough to pay 7 per cent, dividends upon 
preferred stock and 5 per cent, on common stock, or about 
25 per cent on possibly decent valuation. 

Coal operators are running their mines in the same 
manner, and they are under martial law, trying 40 men 
and Mother Jones under this law for the alleged killing 
of soldiers who had fired upon a body of miners. 

How is all this to be remedied? 

There is no half-way ground. First, reverse the 
order of things as they are today, and legalize all these 
utilities for the people at cost, namely: 

Furnish all money to all the people at cost. 

Abolish all stocks and bonds. 

Abolish all interest and dividends. 

Take over, through condemnation proceedings ALL 
RAILROADS, pipe lines, public utilities, telegraphs and 
telephones, paying physical value for them in full legal 
tender money, confiscating the franchise and water value. 

Take over all mines, oil, gas, all large productive cor- 
porations, and run them at cost to all the people. 

Put in place of all stocks and bonds, full legal tender 
money at cost. 

When we declare for this service at cost, we mean the 
application of the same principle which supplies the peo- 
ple their postal service at cost. 

If a manufacturer has a legitimate industry upon 
which he pays taxes and which the banks consider good 
collateral for a loan, let the Government be as good to 
him as it is to the banks, and supply him his capital with- 
out the tax of five to eight per cent, interest. 

If the farmer has a three thousand dollar farm and 
he wishes to secure the use of a thousand dollars to 
further make improvements or stock his farm with catt ? 
or hogs, let the government handle that loan and handle 
it at cost, the same as it does to the banks. In other 
words let the farmer pay the same 6 per cent.- he pays 
to the banker, allowing four per cent, of each interest pay- 
ment to be applied on the principal, one-half of one per 
cent, go to cover the cost to the government for handling 
the transaction, and one and one-half per cent, go into the 
general revenue fund, displacing the necessity for internal 
revenue taxes and import duties. 






THE COXEY PL'AN 79 

The Missing Link 

If there is any one thing a class conscious, revolution- 
ary, stand-pat Socialist orator craves, more than another, 
it is to have his audience propound questions. 

The Highway is good naturedly going to submit just 
one and be it speaker or writer, who can furnish the best 
reply, will have the space, and it need require but a few 
lines. It is this : 

What provision does the Socialist program offer for 
the employment of labor displaced by improved machinery 
during this transition period so much talked about, 
through which we are supposed to be passing, from cap- 
italism into the next, or, Socialism? 

Highway's overseer has made bold to privately pro- 
pound this inquiry to the last three speakers who have 
splendidly handled their subjects before audiences in Mas- 
sillon. The only reply given, was "open government 
works, road building/' etc. 

Even this does not meet the question in the mind of 
the average jade who is so tired of the present grind for 
an existence he cannot go home with a smile on his face, 
from the grim fear that when he returns to his place in 
the morning he will find a new machine doing the work 
and he out of a job. 

The Socialist is supposed to be long on program — 
definite program. Programs which tell "how" and all 
about it. Is it too much to ask him to relate in what 
manner, under the present system he is to provide pay- 
ment for such labor on public works? 

Is the worker to be paid in gold, silver, paper, or 
checks ? Who is to control the issuance of such funds, and 
how does the Socialist propose to deal with the banking 
question which he will promptly bump into when he starts 
to open public works and peacefully begin to revolution- 
ize? 

It is no answer to this question to dilate upon what 
will be the program under Socialism. We are not there 
yet, meantime there are millions of stomachs to be filled 
three times a day, millions of helpless women and chil- 
dren to clothe, shelter and school. 

It is the NOW, here under capitalism, this part of 
your program must be made to apply, else it is a de- 
fective program. That is true or it is not true. 



80 THECOXEYPLAN 

This leads to another inquiry, pertinent right here. 
If the man who sees the need for this definite program, 
one that is worked out ready-made for application the 
minute a majority are ready for it, and which in its' 
operation will give the workers a taste of what they can 
acquire by driving the wedge deeper and deeper into the 
present system, if such a man is merely a "reformer" 
what is the man who has NO program to offer the jobless, 
displaced victim of the system? 

How many of the eloquent exponents of Socialism 
can stand before an audience and in as few words make 
clear answers to the question "What is Money?" as they 
can to make you look upon the employer under the present 
system as a greedy parasite? 

Here is an operative working in the mill. He is told 
the mill is to shut down for repairs, and he may have a 
few weeks in which to relax and get acquainted with the 
family. When the whistle blows he reports for duty and 
finds a lot of new machines have been installed removing 
necessity for his further services there. He turns to the 
Socialist and asks what he is to do? 

"Vote for Socialism," he is admonished. 

"What am I to do with my family between now and 
election day?" he asks the Socialist. 

Can the Socialist point to his program and give him 
any better reply than Taft's immortal "God Knows?" then 
proceed to damn the system. 

But the system won't move out any the faster for 
more damning. If damning the system would remove it 
it would have been gone long ago. It has been damned — 
is damned. It is putrifying, rotten. Not a man or 
woman with self-respect or a direct beneficiary longer 
pretends to defend it. But it is here. It is all we have, 
and must be carted away to the dump, a part at a time. 
A beginning must be made, a place cleared for starting 
foundations for the new. 

Can't you make a place for at least one piece of con- 
structive machinery to operate? Our printing presses are 
worn out in the service of printing diplomas for efficiency 
to graduates in the wrecking service. 

Speakers themselves are chafing under the monotony 
of their old song. They can feel the undertow currents 
from the multitude they are addressing for a "show us 
how" yet forced to dismiss their audiences before that 
point has been reached. 



THE COXEY PLAN 



81 



Great papers like the New York Journal are openly 
proclaiming the doctrine of confiscation. Others will soon 
be declaring for repudiation. Both of which the Socialist 
will repudiate as he repudiates the direct action of Hay- 
wood. And he should. 

Yet, when pinned down for a concrete program, 
which of the four mentioned has the advantage? Will 
someone answer? 

For many years statesmen, philanthropists, sociolo- 
gists, and Socialists have chosen to cast aside one stone 
which may be labelled the Money Question. If you get 
your New Jerusalem walls up to the point where no other 
stone will fit, possibly a discovery will be made once more. 
Better go over your blueprints before rushing the work 
unduly. It may save you having to do over again some 
very important details in the structure. 

"For the stone which the builders rejected shall be- 
come the head of the corner." 




David Coxey, 11 Years, Courier in March, 1914. 



82 THE COXEY PLAN 



U 



Justice for Coxey ' 



The design of this paper is to diffuse among the people correct 
information on all interesting subjects, to inculcate just principles in 
religion, morals, and politics; and to cultivate a taste for sound litera- 
ture. — [Prospectus of the Evening Post, No. 1, November 16, 1801.] 

N. Y. Evening Post, Feb. 6, 1913, most conservative 
of N. Y. press, editorially says: 

The time has come, it seems to us, to perform a sim- 
ple act of justice to "General" Jacob S. Coxey, of Ohio, 
for the reason that, if some one does not recall at this 
time the facts of history, this great advocate of the peo- 
ple's welfare will be deprived of the laurels that are prop- 
erly his. It will be remembered that in 1894, while the 
effects of the panic of the previous year were still acutely 
felt, Gen. Coxey organized his army of the dissatisfied artd 
unemployed to march on Washington and demand of Con- 
gress that this Government of the people be restored to the 
people. He was hooted at, ridiculed, denounced, and troops 
were called out to regulate the progress of his forces. But 
when he reached Washington he was accorded a respect- 
ful hearing by a committee of Congress. His arguments 
were subsequently reprinted in pamphlet form, and it is 
upon this that we shall draw to prove that many of our 
modern reformers have deliberately plagiarized from Gen- 
eral Coxey in their efforts to set the people free. 

There is the initiative and referendum, for instance. 
How few people know that Coxey was the first of our 
great statesmen publicly to demand them, not only for 
Ohio, but for the nation — or at least to walk for them? 
Others, college professors and students of Swiss his- 
tory, may have privately advocated these innovations, 
but Coxey and his followers were the first to go 
to Washington and ask to be counted, on the grounds 
of the capitol, in favor of these propositions. There 
are those who would claim the honor of being the 
pioneer public man to advocate this reform for William 
S U'Ren, of Oregon, to whom is also credited the prose- 
lyting of Woodrow Wilson. The latter may be true, but 
for Coxey we claim first honors, just as we proclaim him 
the originator of the idea of walking to a place in order 
to get what you want. This latter we stress particularly 
lest a fickle public credit this political device to "Gen." 
Rosalie Jones and her undaunted suffrage hosts that, hav- 
ing conquered Albany, are now preparing to move on 



THE COXEY PLAN 83 

Washington, just as Coxey did nineteen years ago. But 
if time has thus set its stamps of approval upon Coxey's 
on-to- Washington policy, it has equally vindicated his ap- 
peal for the initiative and referendum in Ohio. By an 
overwhelming majority, just eighteen and one-half years 
after Coxey demanded them in Washington, they were 
written by his fellow-citizens into the organic law of his 
State. Who will venture to prophesy, in this swiftly 
changing time, that a statue of Jacob S. Coxey will not 
stand side by side with that of "Rise-up" William Allen 
in the rotunda of the Capitol from whose grounds rude 
policemen once ejected him? Yet in all the paeans of 
triumph after the Ohio election, we regret to say that 
Coxey's name was not mentioned. 

So, too, we were distressed to find that certain 
phrases originated by him were freely adopted during the 
last campaign without regard for his copyright. Coxey 
first said: "In order that the people may be enabled to 
regain control of their State, county, and municipal af- 
fairs, we demand," etc. Yet no phrase has more fre- 
quently been used by candidates, from Bryan down to 
La Follette and Sulzer and all the Progressives, than this 
little gem — always without credit to Coxey, the first to see 
that our Government had slipped out of the hands of the 
plain people. As for Bryan — but here we reach a difficult 
subject. Who was the chairman of the Committee of Con- 
gress which heard Coxey on that ever-memorable Tues- 
day, January 8, 1895, but William Jennings Bryan, then 
Representative from Nebraska? Now, we are not going 
to join certain friends of Coxey in insisting that all his 
radical ideas Bryan obtained from Coxey at that day and 
hour. Mr. Bryan's heart, we know, was throbbing for 
the plain people before that time. So we would merely 
point out that, just as there are two claimants for the 
credit of every great invention, Mr. Bryan had arrived 
at fhe same conclusions simultaneously with Gen. Coxey. 
Thus, as chairman, Mr. Bryan must have thrilled to hear 
Gen. Coxey say: "The great issue, I believe, before the 
American people today is whether the railroads are going 
to own the Government or the Government is going to 
own the railroads. I can show you plainly how you can 
buy up the railroads of every State and Territory, and 
- v pay for them." True, Mr. Bryan did not speak out for 
Government ownership for some years thereafter; but 
each great man must take his own time for such public 
pronouncements. Today, in 1913, do we not read of a 



84 THECOXEYPLAN 

Massachusetts legislative proposal to buy the railroads? 
Is not the Federal Government now owning and operating 
a railroad in Panama? 

But we could fill a page with similar illustrations of 
the way in which time and fate have persistently caught 
up with and justified Gen. Coxey. One of the chief planks 
in his platform was, "a service pension to all soldiers of $8 
per month, and in addition one cent per day per month for 
each day of actual service/' We submit that the dollar-a- 
day pension demand was but an echo of this, and that 
the universal pensioning of every veteran so recently 
achieved, must be attributed primarily to Gen. Coxey. 
Again, on Gen. Coxey's special compaign car stood the 
legend: "All railroad section men to receive no less than 
$1.50 per day of eight hours' work." Who has a better 
right to claim the credit of the high wages and short 
hours of section hands today? Of course, we must admit 
that Coxey's bill providing for non-interest-bearing bonds 
has not yet been adopted by Congress. That need dis- 
courage no one, for we have come but a short distance 
from 1894, and, moreover, it is to be observed that this 
plan of paying no interest on other people's money has 
been of late, not altogether unheard of in Wall Street. 
Finally, we confidently expect to see in the next Pro- 
gressive platform these two Coxey planks: "It is the 
crime of the nineteenth (twentieth) century that three 
millions of our fellow-citizens are in involuntary idleness, 
thus causing an irretrievable loss, of millions of dollars 
daily" (this being coupled with a demand that every town, 
village, township, Territory and State issue bonds to em- 
ploy the unemployed) ; and "President, Vice-President, 
and United States Senators must be elected by direct vote 
of the people." 

COMMERCE. 

My object is to illustrate underlying principles, by tak- 
ing "Commerce" as a text. * * * 

If you will pass along the highways and byways of 
trade and listen to all that is said of the importance of 
extending our commerce, you will be led to think that 
"Commerce" is to the physical condition what Wall street is 
to Congress — its soul. 

Indeed, the world at large, without "Commerce," wouia* 
be like a political canvass without whiskey — dead. 

To hear the "long headed" fellows talk of the "desira- 
bleness" of extending our "Commercial relations," you 
would think "Commerce" 



THECOXEYPLAN 85 

"Was the sum of all good." "The end of all desire." 

Ah! me, there are statesmen, not only "long headed," 
but "thick headed," too. 

They affirm : "The necessity of extending our Commerce 
has become supreme." 

Our whole foreign trade is two per cent as compared 
with our domestic, which is ninety-eight per cent. 

And yet there are men who are dying because our gov- 
ernment will not give its whole energies to furnishing a 
money for the two per cent and let the ninety-eight per 
cent perish for w^nt of sufficient money to do the vast busi- 
ness transacted at home. 

These "rampant roarers" are shedding barrels of tears 
over the ttco per cent but not a tear for the ninety-eight. 

! wisdom, be silent. ! reason, be dumb. 

Now for a little sense. 

Ask one of these fellows — "What is Commerce?" 

"What is that thing that you say must be extended — ex- 
tended to foreign countries?" 

Let us know exactly what you want extended. 

If you urge them to give you a definition of "Commerce" 
they are wholly disqualified for the task. * Their verbosity 
of speech is only equalled by their inanity of sense. Our 
foreign Commerce should be attended to as a wise policy. 

But our home trade must be nurtured and cared for, 
with our whole strength, in order to the highest happiness 
of the people. 

To neglect our home Commerce is to court the death of 
the Republic. * * * 

What is Commerce? Those who talk learnedly about 
"extending" it fail to give a definition of it. 

Those who say the extension of our Commerce is a 
"necessity" are wholly lacking, in clear definition, as to 
what they want. 

"Commerce" with them is a general term and they can- 
not intelligently explain, even to a boy, what they are talk- 
ing about. 

So all the way from Legislative Halls down there is much 
noise, little sense and less truth on this question. 

We ask for definitions. Let us hear from the people. 
We give ours and from it argue. 

"Commerce" — the traffic in and carrying from one place 
to another the products of human labor and human genius 
— derived from nature. 

He who loads his wagon at his barn with wheat, and 
draws it to the warehouse, is a part of Commerce. For he 



86 THE COXEY PLAN 

is carrying from one place to another the product of labor. 
To create "Commerce" — foreign and domestic — two 
things are essential. 

1. Change of title to the product. 

2. Change of place of the product. 

To extend "Commerce" two things are necessary: 

1. To increase the change of title. 

2. To increase the change of place. 
To do this, tivo things are needed: 

1. Some "medium" by which title in products can be 
changed. 

2. Some "medium" by which the product itself can be 
moved. 

"Traffic" is merely changing title. 

The merchant selling goods is but changing title — and 
the more title he can put out of himself into his customer 
the better the day's business. 

There are two ways of changing title. 

1. By barter. 2. By money. 

Credit is but a change of title, to be closed by barter or 
money, in the future. 

These positions being true — it follows: 

1. That there must be a sufficiency of the "medium" to 
healthfully exchange all the titles need to be changed. 

2. That there must be a sufficiency of the "medium," to 
healthfully move to the places required, all products that 
need moving. 

The sequence to this is: In the rightful exchange of 
title and carrying from place to place the products of 
labor, to the extent required by the diversified wants of 
mankind, are the material interests of the race, most fully 
assured. While to disturb these great equities of life is to 
become a murderer. 

Before we illustrate these, let us state some maxims. 

1. Man's highest duty is : 

To make of himself the best intellectual, moral and 
physical being possible. 

2. To do this he must be fed, clothed and sheltered. 
Hence, that he may accomplish these high duties he must 

have free access to nature. 

There must be, therefore, the change of title of products 
and the change of place of products. And it follows that in 
exact proportion to the change of title in products and th& 
change of place of products, is the happiness of man ad- 
vanced or retarded. 

Neither the form of government, the age of the world, 



THECOXEYPLAN 8/ 

nor the religious belief in the least degree affect these cen- 
ter truths in the life of man. * * * Labor was the 
first, the great gift to man. Capital is the fruit. 

Bearing these elementary principles in mind, let us 
amplify: Let us, for the "medium" by which title is 
changed, substitute "dollar," and bank credits. And let us, 
for the "medium" by which the product is moved, substi- 
tute "car," and equipment. 

Then let us suppose that a munificent father, through 
his bounteous ways, has filled the world, in response to the 
toil of man, with all that is needed to feed, clothe and shel- 
ter. 

And on a certain day it is found that there are "dollars" 
and bank credits enough to change the title to labor in pro- 
duction and products as fast as the demands of food, cloth- 
ing and shelter require. 

And on the same day it is found that there are enough 
"cars" to move from place to place products as fast as the 
demands of food, clothing and shelter require. 

Then human interests, material, are at their best. The 
highest mortal state is attained. The march then is toward 
intellectual, moral and physically perfected manhood. 

At this point, when all of material happiness seems to 
blend with an infinite plan, suppose the government, no 
matter what its form, should reach forth with sovereign 
grasp — 

And take half the "cars," lock them up or destroy them, 
or stop purchasing equipment for railroads. 

Infinite wisdom could alone tell the horrors that would 
follow. 

Products would gorge in one place, in another place, 
emptiness. One place would have surfeit of food, in an- 
other starvation. Earth, the day before fair as Eden, now 
turned into a lazarretto of death. Nature's bounties de- 
stroyed and its blessings turned to a curse. 

And all from the simple fact of stopping one-half of the 
"cars" — or stop purchasing equipment for railroads. 

"Commerce" would be ruined, its necessary elements 
annihilated. 

What would the just man say, what would he think of 
a government like that, a government transformed into an 
enemy of both Nature and man? 

' But suppose the "cars" are all left and the government 
takes one-half of the "dollars" that are the basis for nine 
dollars each of commercial bank credits, out of circulation, 
locks them up or destroys them. And, when remonstrated 



THE COXEY PLAN 



with, instead of changing its course, keeps on till all the 
"dollars," and credit, save one quarter or less, is locked up. 
And then boast "there were just as many dollars as ever." 

Such a government would be a tyranny unequalled in the 
world's history. 

The men who brought such a condition should be totally 
destroyed and their names head the list of infamy in all 
after ages. Mortal man could not tell in all its fullness the 
suffering that would fill the world. 

Starvation and. death, in a march through the fields of 
desolation, would make a picture that would cause heaven 
to be draped. 

Business failures would multiply. Penitentiary officers 
would increase. Murder would reign. Lunacy grow till 
hope would die. Suicide would fatten as it roamed the 
fields of despair. Divorce, with the vengeance of a devil, 
would threaten with utter extinction the marriage relation 
— the holiest relation of all. 

And then the rulers, no matter of what name, are stricken 
to death by the hand of assassination. 

These signs of a dying civilization are lighting up the 
world today. Take warning ! 

The locking up or destroying of the "dollar" — the basis 
of bank credits and curtailing bank credits would be — is — 
infinitely worse than destroying the "cars" and stopping the 
purchase of equipment. 

For the "Credits" (debts) could never be discharged 
and the interest on them could never be paid. 

So man, bearing a burden, so heavy as to make life a 
curse — dies in despair. * *' * The direct effect of 
locking up the "dollars" and curtailing bank discounts is to 
drive us down to barter, to destroy Commerce, — to destroy 
civilization. 

"Commerce" destroyed, man reduced to a savage. 

The exchange of title of the infinite variety of products 
— stops. The carrying from place to place of this infinite 
variety — stops. "Old chaos reigns — " 

"The damned, in ceaseless chatter, ring out hell's jubi- 
lee." The world — our Republic — is struggling in the midst 
of this sea of ruin today. As the "dollars" and bank credits 
grow less "Commerce" becomes a curse. 

For the other factor, "cars," double up their demands— 
so that the carrying of products from one place to another 
becomes a monopoly — "Infinite in grasp, deathless in pur- 
pose." 'And as "dollars" and bank credits lessen in num- 
ber, and railroads stop buying equipment, monopoly grows 



THECOXEYPLAN 89 

until the nation hangs in even balance between life and 
death. 

The stoppage of purchase of equipment of the railroads 
of ninety per cent as they have done the last ten months 
has paralyzed the business of the country and created five 
millions of unemployed which is a crime. 
^The value of "dollars" and bank credits consists in 
putting them away from you, for something that will feed, 
clothe and shelter the body. So to hoard "dollars" and cur- 
tail discounts is a crime! 

The "dollar" and bank credits is the "medium" to change 
title. So to hoard "dollars" and curtail bank credits is a 
crime ! The "car" is the "medium" to change the place of 
products. So to stop them is a crime. And to make them 
a monopoly is a crime. So to stop purchaaipg equipment 
is a crime. 

The "dollar" (the medium of exchange) knows no state, 
no nation — the world is its field. 

The "car" (all appliances for carrying) knows no state, 
rio nation — the wcild is its field! 

Wherever upon earth Nature has spread her bounties 
and laid up in store that which will feed, clothe and shel- 
ter, when utilized by labor — there "capital," with the "dol- 
lar" and stop discounts and bank credits in one hand and 
the "car" in the other, rears its tabernacle — and begins the 
robbery of Nature and man. It does it by monopolizing the 
"medium" that changes title to products, and by monopoliz- 
ing the "medium" that changes the place of products, and 
stop purchasing equipment. 

"Capital" has spread its checker-board — it is the world. 

The stake played for — possession of the earth. 

And when the game is counted, the result declared, it 
will be — Slaveholders on one side — slaves on the other ! 

The gold standard means this. 

The fight against legal tender means this. 

The substitution of full legal tender paper money in vol- 
ume sufficient for all purposes in place of bank credits 
through a system of Federal Banks at a tax of 2% and Fed- 
eral ownership of all transportation lines — is the remedy 
so far as the money and transportation questions are con- 
cerned. 



\ Having discussed the questions in group and singly it 
remains to urge the supremacy of labor over capital in 
order that civilization may live, and then show that the 
trust question is the one in which labor is to be enfran- 
chised. 



90 THE COXEY PLAN 

NATIONAL BANK PRIVILEGES 

1. The National treasury holds their bonds for safe keep- 
ing, and collects and pays over the interest free of charge. 

2. The government loans them 95 per cent of the face 
value of the bonds on twenty years' time at 1 per cent per 
annum. 

3. Both the bonds they deposit and the money they re- 
ceive are exempt from taxation. 

4. The treasurer is authorized to pay them the interest 
on the bonds one year in advance without rebate. 

5. They are authorized to receive deposits and to loan 
them out, and to reloan the currency they receive and thus 
get double interest — one interest on what the government 
owes them and another on what they owe the government 
and the people. The law authorizes them to subscribe 6% 
of their capital and surplus to regional reserve banks and 
borrow; it back with postal deposits and all government 
revenues. 

6. After they have loaned out their money on first-class 
security, and pay day is approaching, the law authorizes 
them to contract and retire their circulation, so they can 
create a panic, bring prices down, and bid in their secur- 
ities at half their real value. 

7. The same law authorizes them to inflate the currency 
without limit, and raise prices so as to sell their confiscated 
securities back to their owners at double the cost they were 
bid in at. 

The same law authorizes the go vernment to issue the money to the 
banks at cost, then compels the government when it needs money to 
build the Panama Canal to issue interest bearing, non-taxable bonds, 
sell them to the banks, borrow the money the government created 
and turned over to the banks at cost, and now taxes the people to 
pay the banks interest for the use of the people's own money. 

The following opinion, contained in a press dispatch, date un- 
known, is of interest right here: * 

There is no such thing as money in the bank, according to an 
opinion delivered by Attorney General Byers, of Iowa. You may 
put money in the bank, and then the bank owes you money, but so 
far as having any money there, you have not. 

The opinion was delivered at the request of Auditor Carroll, to 
whom an application had been made for a permit to conduct an 
insurance company which was to insure bank deposits. The question 
was referred to the legal department for an opinion as to legality of 
such a company. 

"Money in a bank is not the subject of insurance," said the v 
attorney general. "In fact, there is nobody, legally speaking, who 
has money in the bank. The money which a man takes to the bank 
ceases to be his when he places it in the hands of the banker and 
receives a receipt for it on his pass book, or a certificate of deposit. 



THECOXEYPLAN 91 

The money then belongs to the bank, and the bank owes the depositor. 
The depositor has no title which he can insure, for he owns nothing. 
He has parted with his money and simply has the promise of the 
bank to repay him a like amount; but he has no actual money that 
he can trace and nothing so intangible as a bank's obligation can be 
the subject of insurance. No recovery could be had for the loss of a 
bank deposit, because the depositor does not own the money." 
^ Under this ruling the auditor refused to license the company. 

What would the bankers say if a crazy farmer should 
make the following demands upon one of their institutions : 

Farmer — "Mr. Banker, I have a deed of a farm here 
which cost me $10,000. I desire to deposit it in your vaults 
for safe keeping." 

Banker — "All right. You will, of course, be willing to 
pay us for the care we bestow upon it?" 

Farmer — "Not at all. I want you to loan me $9,500 for 
twenty years at 1 per cent per annum in consideration of 
the deposit." 

Banker — "Anything else?" 

Farmer — "Yes; I want you to collect the rent on my 
farm and pay it over to me without trouble or cost on my 
part." 

Banker — "Anything else?" 

Farmer — "I want you to relieve me from all taxes, na- 
tional, state and municipal, on both my farm and the money 
you loan me on my deed." 

Banker— "Is that all?" 

Farmer — "Oh, no; not by a jug full! I want you to pay 
me the rent on my farm a year in advance, without rebate." 

Banker— "Well, what next?" 

Farmer — "I want you to make me the custodian of your 
surplus deposits and when you require currency to meet 
current demands pay me 8 or 10 per cent for the use of it." 

Banker — "What am I to get for all these privileges to 
you and sacrifices on my part?" 

Farmer — "One per cent for the $9,500 you loan me, one- 
half per cent on the deposits you make with me, and the 
glory of my confidence and the credit you will be honored 
with from my family." 



Abraham Lincoln in letter to General Waggoner : 
"The bonds at end of five years should be paid in green- 
backs, and the interest stopped. This is not doing wrong to 
the bondholder, and it is doing right to the soldier and the 
whole country," 



92 THECOXEYPLAN 



UNITED STATES SUPREME COURT 

The issuance of money is a requisite of sovereignty. 
It can be coined, made of any material the government issuing 
it may select. 

The legal question in the United States has been settled by th<> 
Court! 

"As the act of February 25, 1862, declares that the notes of the 
United States shall also be lawful money and legal tender in payment 
of debts, and that act has been sustained by the recent decisions of 
this Court as valid and constitutional, we according to this decision 
have two kinds of money, essentially different in their nature, but 
equally lawful.' ' 

Here the Court of the United States puts metal and paper money 
on the same constitutional ground, both lawful and constitutional. 

In a later case, the last one before the Court, they are equally 
clear. 

The case of Sullivan vs. Greenman, in the Supreme Court of the 
United States, March 3, 1884, the question at bar was, the Consti- 
tutionality of the Act of Congress of May 31, 1878. 

"Congress has the Constitutional power to make the treasury 
notes of the United States a legal tender in the payment of private 
debts in time of peace as well as in time of war." 

The Court says: "The single question, therefore, to be consid- 
ered, and upon the answer to which the judgment to be rendered 
between the parties depends, is, whether notes of the United States 
issued in time of war, under Acts of Congress declaring them to be 
a legal tender in payment of private debts, and afterwards in time 
of peace redeemed and paid in gold coin at the treasury and then 
reissued under the Act of 1878, can, under the Constitution of the 
United States, be a legal tender of such debts." 

"Upon full consideration of the case, the Court is of opinion 
that they can." 

"We are irresistibly impelled to the conclusion that the impress- 
ing upon the treasury notes of the United States the quality of legal 
tender in payment of private debts, is an appropriate means, and is 
plainly adapted to the execution of the undelegated powers of Con- 
gress, consistent with the letter and spirit of the Constitution." 

"Congress is authorized to establish a national currency — either 
in coin or in paper — and to make that currency legal money for all 
purposes, as regards the national government or private individuals." 

"It follows that the Act of May 31, 1878, is constitutional, fhat 
the tender in treasury notes, reissued and kept in circulation under 
the act, was a tender of lawful money in payment of the debt." 

This settled the question that the government can make lawful 
money out of Paper. 

"The question whether at any particular time, in war or in peace, 
is a political question to be determined by Congress, when the ques- 
tion, exigency arises, and not a judicial question to be afterward 
passed upon by the Courts. 




Carl Browne, General Jones and Coxey, 

Photographed After Entering Jail Hand-cuffed, to Serve a Sentence 

of 20 Days for 'Treading Upon the Turf or Grass 

and Injuring the Shrubbery." 






PASSING OF CARL BROWNE. 



Words fail me in this connection when seeking expression 
for the loss sustained, not alone to the commonweal movement 
but to the country as well, when the Chief Marshal of the jS 
former march, Carl Browne, passed away in the city of Wash- 
ington, Jan. 23rd, last, after an illness of less than two hours. 

I can say no more here than I have said to my friends 
many, many times, that Browne was the most unselfish man of 
my entire life's acquaintance. He never gave a thought to 
pecuniary gain. His whole heart was in the movement to 
emancipate labor, which forced his mind to continuous and un- 
ceasing action along these lines, until finally, nature overtaxed, 
he dropped dead in his great life work. 

Twenty years ago, while he was living at my home, during 
the fall and winter preceding I had him campaigning con- 
stantly on the money question. We were together constantly, 
and trying to hit on some plan to get the nation aroused to 
the unemployed conditions so as to get quick action. 

He related one day in November, 1893, as we were driving 
and within a mile of my home (in the country near Massillon) 
about having marched the unemployed in San Francisco, so I 
said, "Browne, we will get up a march to Washington," and 
from that moment till the 25th of March when the start was 
made, we were kept busy organizing and circulating petitions 
to Congress on Good Roads and Non-Interest bonds. 

After 35 days' march we arrived at the Capitol, and while 
making an effort to present our petitions to Congress, Browne 
and Jones were arrested, taken to jail, and I was escorted off 
the Capitol steps and grounds by a police squad, but not arrested 
until three days later. They tried us for "treading on the turf 
or grass and injuring the shrubbery," fined each of us five 
dollars and twenty days in jail. 

While there Browne and I occupied the same cell, so my 
tribute to him is from personal contact and knowledge. His 
whole thought the last two years was bent on how to get the 
Socialist party to line up in favor of the three measures that 
the second march is trying to focus the attention of the country 
and Congress upon. J. S. C. 




Jacob S. Coxey and Carl Browne 

In Cell of District of Columbia, Washington, D. C, Jail, Serving 

Sentence of Twenty Days for "Treading Upon the Turf 

or Grass, and Injuring the Shrubbery." 



the 
the 






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WHAT SOCIETY OF EQUITY IS DOING IN IDAHO 

The Farmers Society of Equity are circulating the following: 

We have in this state the electing of a United States Senator 

fcd two Representatives; but before we give them our vote, we 
.^sire a pledge from each of them that they will lend their best 
efforts to the establishing of government banks wherever necessary 
"*r the purpose of loaning money direct to the people at 2% per 
*hnum. 

We offer the following reasons why we think the laboring people 
md farmers should use their franchise to secure its adoption: 



' 1. Money, being created by law, and the people the law-makers, 
therefore, as a whole the people should receive the benefits of that 
aw instad of a few favored ones. 

2. As a result of the use of that law, the people of the United 
States find themselves in the following condition: 

It is reported that there is on deposit in the United States, and 
>elonging to the people, twenty billions of money, while all the 
noney we actually have in circulation is, according to the comptroller 
>f the currency, $3,282,500,000; now if the depositors wanted their 
noney — how many could get it? 

About one-half of the money is redeemable in gold. Our laws 
ompel the government to keep on hand in the treasury $150,000,000 
n gold to redeem this paper money, or greenbacks, and we think 
here are gold treasury notes in circulation sufficient to take up this 
•eserve, hence the others are not secured, which amounts to $350,- 
100,000. 

3. There is $759,000,000 of National Bank Notes in circulation, 
>ayable by whom — or in what — I do not know. 

4. Through the scarcity of money the people have been com- 
piled to go into debt to the amount of $90,000,000,000 of interest 
rearing bonds, which average 5% per annum, which, in the aggre- 
gate, amount to $4,500,000,000 payable in gold. This amount is $1,000,- 
100,000 more than all the money we have in circulation. What the 
esult would be if called upon to pay our interest can be imagined. 

5. The only way to raise money to meet these obligations is 
>y higher taxation; therefore, what will be the result if the present 
ystem continues? 

6. The only politics we have had, with few exceptions, is the 
'Big Pocket Book"; the time has evidently come when the people 
lust take a hand in governmental affairs, and if they will consider 
he ticket at the beginning of this paper, we think it will be financial 
reedom to them. 

7. The reason the rate of interest is advocated so low is that 
b will stop the future issue of bonds. 



LIBRARY OF CONGRESS 

iiiiiiiiiiiiiiii' 

.r~a**tPO*Ti.4}iMmumzim 027 273 676 51***^ 

Massillon, Ohio, March 25th, 1914./ 

HON. WOODROW WILSON, President/and Members « 
House and Senate of the United States: 

Sirs:—Twenty years ago today the Commonweal 
started the weary march from Massillon, Ohio to Washing _ 
ion, to petition Congress to pass two laws, the Non-Inter- 
est Bond and Good Roads Bills, to set the idle to work on 
Market Roads and other public improvements. j 

Three of the leaders were jailed twenty days for then • 
efforts, myself being one of them. 

April 16th, 1914, the Commonweal will start again, 
going over the same route, arriving at Washington May 
21st, 1914, petitioning and demanding the passage of three 
measures fully explained in this book. 

I am mailing a copy of The Coxey Plan to each of the 
members of your Cabinet and the Supreme Court of the 
United States, as well as to yourselves. 

This will give each of you at least forty-five days' time 
to inform yourselves as to the objects of this second march, 
practicability and justice of the demands; whether we are 
to be treated as citizens under the Constitution and allowed 
to present our petitions upon these measures and to be 
heard from the steps of OUR National Capitol, or denied 
that constitutional privilege and again cast into prison for 
alleged treading upon Special Privilege Grass. 

Yours truly, '■ 

JACOB S. COXEY, 
Commander-in-Chief Commonweal of U. S. 






Holli 



LIBRARY OF CONGRESS 



027 273 676 5 



Hollinger Corp. 
P H8.5 



